Penn National Gaming Still Looking to Sell LV Tropicana

Penn National Gaming is one of the country’s biggest and most successful casino operators. The company has made headlines recently for some of its major deals and acquisitions. This week, officials within Penn Gaming announced they’re still looking to sell LV Tropicana.Tropicana Las Vegas Casino Logo

The sale of this casino-resort has been discussed for years. It’s a popular venue off the Strip and is likely to fetch a high price. Today, we’re going to look at some of the Tropicana’s recent deals and talk about when the company is looking to sell this property in Las Vegas.

Penn Gaming Purchases 36% Stake in Barstool Sports

There’s a good chance you’ve seen Penn National Gaming’s name in the headlines recently. Recently, this company paid $136 million for a 36% stake in sports blog Barstool Sports. With this investment, Barstool is now valued at an incredible $450 million.

The decision to work with this company makes sense for Penn National Gaming. Barstool Sports has one of the largest social media followings in the country. Most feel that the deal will help to bring significantly more people to Penn Gaming’s casinos.

Ron Baron, a billionaire investor in New York, believes this deal will prove extremely valuable for the casino company.

“Not only are they going to make a lot of money on this investment for this $150 million and buy the rest of it out from the founder, but also it’s going to increase the traffic in their casinos,” Baron said. “It’s going to be worth a ton.”

It’s clear that Penn National Gaming is looking to expand. Interestingly, the company wants to start generating more revenue from property sales. As a result, officials are now looking to sell the LV Tropicana. Based on several reports, this sale will take place sometime in 2020.

The Push to Sell the LV Tropicana Continues

The Tropicana Hotel-Casino in Las Vegas is one of the city’s most popular venues not located off the Strip. It opened to the public all the way back in 1962. Since that time, it’s changed ownership hands several times.

Several major renovations have also been made to this property. In 1986, the owners built a new 21-story Island Tower here. In 2007, a massive $2 billion expansion project was planned. Due to the financial crisis, these plans were eventually scrapped.

In 2015, Penn National Gaming purchased this property for $360 million. The company has worked hard to make this a more popular with locals and tourists. Unfortunately, it appears the revenue generated from this hotel-casino is not as high as initially projected.

As a result, Penn National Gaming is looking to sell LV Tropicana. Jay Snowden, CEO of Penn Gaming, told the media that several offers for this venue have already been presented.

“On the Tropicana side, there’s been so much unsolicited interest that it’s just very active,” he said. “We got another call two days ago with interest in potentially acquiring some or all of the land holdings there. It’s very active.”

Snowden claims this sale is a real priority for the company. Competition in the US casino industry continues to grow. Let’s take a look at how Penn Gaming performed last year.

Penn National Gaming’s 2019 Revenue Figures Are Released

The US casino industry is in an interesting place. More states have recently begun to expand their laws to allow more casino gambling options. As a result, many companies are beginning to earn significantly more revenue.

On the other hand, competition is growing in this industry, too. Some of the biggest companies are controlling much of the market. Penn Gaming’s investment into Barstool Sports was expected to help with this issue.

Unfortunately, the company recently reported revenue losses in 2019’s fourth quarter. The company posted revenue of $1.34 billion last quarter. This is significantly less than analysts initially projected.

This isn’t something to be concerned about, though. Most feel that this company’s share prices will continue to rise throughout 2020. Once the company is able to sell LV Tropicana, these shares will increase significantly.

It’s an exciting time for Penn Gaming and the US casino industry as a whole. Stay tuned for more casino news over the next few months!

Penn National Gaming, Owner of Tropicana, Buys Stake in Barstool Sports

Cartoon Hands ShakingPenn National Gaming, a regional gambling operator which owns the Tropicana Casino in Las Vegas, announced on Wednesday that it has bought a minority stake in Barstool Sports, the digital sports, entertainment and media platform.

With the $163 million deal, Penn National Gaming hopes it will put them in a prime position to compete in the growing sports-betting market in the US. Barstool, known for its roots as a Boston sports blog founded in 2003, is valued at a whopping $450 million.

When considering the deal, Barstool Sports will become a private gaming partner for Penn National. This deal could be active for up to 40 years and will give them the exclusive right to use the Barstool brand, whether that’s for online betting or retail products.

Penn National expects to close the deal in the first quarter of 2020, according to a company press release.

“With its leading digital content, well-known brand and deep roots in sports betting, Barstool Sports is the ideal partner for Penn National,” Jay Snowden, president and CEO of Penn National, said in a statement.

Increased Company Value Over Time

Initially, the deal will grant Penn National a 36% stake in Barstool Sports, however, that number will increase to around 50% in three years, with an additional investment of $62 million. Initially, Penn National will also receive two seats on Barstool Sports’ board of directors. Penn will receive other forms of executive control as well.

“Penn National Gaming has one of the biggest infrastructures in the country for gambling. They have sports tracks, they have casinos, they’re all over the country. They have the infrastructure, we have this rabid audience, this fan base craving it. Together, we’re going to create an omnipresent approach to gambling,” David Portnoy, president and founder of Barstool Sports, said in statement on Twitter.

Existing Deal Has Supreme Court Ruling to Thank

This deal never would have come to fruition if it weren’t for a key Supreme Court decision that occurred in May of 2018. On a federal level, the court ruling legalized sports gambling in the US. Now, individual states have the ability fo decide if they want to approve the legalization of sports betting and the terms that come along with it.

Since then, there’s been a rush by both media companies and the gambling industry to capitalize on what they both assume will be a boom in online betting. At the time of writing, the primary leaders of this movement are DraftKings and FanDuel. While they were operating as “daily fantasy” sports games, the two organizations spent a lot of money on marketing the activity and are now at the forefront of online and mobile sports betting within the United States.

The daily fantasy bubble quickly deflated, but the investment those companies made exposing themselves to a young audience seems to have paid off. The two companies are now surpassing the older, more established gambling institutions where online sports betting is legal.

Future Plans

Penn National, which runs or owns dozens of low-profile casinos and hotels around the US (Tropicana in Las Vegas being its most well-known property), believes that Barstool will be critical in attracting consumers to its casinos. The brand is also planning to launch an online betting app and bring in more traffic through these accessible means.

The head of Penn Interactive, Jon Kaplowitz, has high hopes for the Bartool Sportsbook brand. On behalf of his company, Kaplowitz states they’re looking forward to introducing 20 million customers to the new brand, through their retail sportsbooks and interactive products. In a statement, he said:

“Our growing team of product and engineering talent at Penn Interactive is focused on what we anticipate will be a best-in-class sports betting app, which is expected to launch in the third quarter of 2020.”

A person briefed on Barstool’s business estimates the company generated between $90 million and $100 million in revenue last year, with the majority coming from podcasts, merchandise sales, and gambling deals. Under the new agreement, Penn National Gaming’s revenue is projected to grow rapidly.

Rumors of a Las Vegas Tropicana Sale Are Circulating

Over the past year, several of the biggest and most popular hotel-casinos in Las Vegas have been sold. Many companies are now focused on selling properties and reinvesting the money earned into new properties domestically and abroad. This week, rumors of a Las Vegas Tropicana sale began to circulate.

Tropicana Las Vegas

As of now, these are still just rumors. Penn National Gaming, which owns the hotel-casino, has not officially confirmed this sale. Today, we’re going to talk about the history of this popular venue, and why it could soon be sold.

Let’s get into it!

History of the Tropicana Las Vegas Hotel & Casino

For decades, the Tropicana in Las Vegas has been a popular venue for tourists looking to save a little money. Its prices are fantastic, yet the hotel still offers a fantastic casino floor and some solid amenities. It’s impressive, considering it’s been around since 1957.

Back in 1955, Ben Jaffe came up with plans to open a new venue on the Las Vegas Strip. Before long, construction began on this venue and in 1957, it officially opened up. Over the first few years of opening, this property changed hands several times. Las Vegas city officials raised concerns that the owners had ties to organized crime.

By the 1970s, the Tropicana Las Vegas was struggling financially. Major hotel-casinos such as Caesars Palace were attracting the majority of visitors. By 1978, mob activities once again took over Tropicana.

Columbia Sussex acquired Aztar, which owned Tropicana Las Vegas, in 2007. The company then announced a massive $2 billion renovation which was scheduled to be completed in 2010. The financial crisis eventually put a hold on these plans.

In August of 2015, Penn National Gaming purchased this hotel-casino for $360 million. Hope was that this company could finally turn things around. It now appears another sale is on the horizon. Rumors of a Las Vegas Tropicana sale have been circulating for the past few days.

Is the Las Vegas Tropicana Sale Taking Place in 2020?

This isn’t the first time people have speculated about a Las Vegas Tropicana sale. This hotel-casino continues to struggle against some of the other, larger venues in the city. Rumors of this sale first appeared back in October.

This week, Vital Vegas announced that the sale was nearing completion. Officials within Penn National Gaming refused to comment on the rumors. Nevertheless, many are claiming that this sale will be completed sometime in 2020.

If this sale is completed, it will be the first Las Vegas Strip venue sale of 2020. As we already mentioned, Penn National acquired the property in 2015 for $360 million. Analysts claim that the company could earn $700 million from a Las Vegas Tropicana sale.

It’s still unclear which company will purchase this venue. Several major companies have expressed interest in acquiring a Las Vegas Strip property.

Penn National Gaming is still dealing with billions of dollars in liabilities. Selling the Tropicana could help to put a serious dent in this debt. We’ll need to wait and see whether or not the company decides to officially put this venue on the market.

More Las Vegas Strip Properties Are Coming in 2020

The Las Vegas Tropicana sale seems highly likely for 2020. This is probably not going to be the only Las Vegas Strip sale taking place this year. Based on the way things have been going, there will be several more of these sales that take place in 2020.

MGM Resorts International is still considering more property sales. Last year, this company sold both Circus Circus and The Bellagio. The latter earned the company $4.2 billion, making it the largest hotel-casino sale in Las Vegas history.

Officials within MGM Resorts claim they are interested in putting more of their major venues up for sale soon. This company is focused hard on breaking into Japan. In order to do this, the company needs capital and property sales are the best way to acquire the money.

The Las Vegas Strip is changing fast. Over the next few years, several brand new hotel-casinos will open here. It’s an exciting time for locals and tourists in the city.

Stay tuned for more Las Vegas casino news over the next few months!