Boyd Gaming makes acquisition approach to Penn Entertainment, sources say
By Milana Vinn and Anirban Sen
NEW YORK, June 20 (Reuters) -U.S. casino operator Boyd Gaming BYD.N has approached Penn Entertainment PENN.O to express interest in acquiring its peer, valued at more than $9 billion, including debt, according to people familiar with the matter.
The potential combination would be the biggest merger among U.S. gambling companies since Eldorado Resorts' $17.3 billion acquisition of Caesars Entertainment CZR.O in 2020.
It would be challenging since Boyd, the smaller company with a market value including debt of $7.8 billion, would need financial firepower to clinch a deal. The companies would also need the blessing of regulators and officials in several states where they both operate.
Boyd would also need to win over Walt Disney DIS.N, which through its sports network ESPN has a partnership with Penn.
The sources said there was no certainty Penn will engage in negotiations with Boyd. They asked not to be identified because the matter is confidential.
Penn declined to comment. Boyd and Disney did not immediately respond to requests for comment.
Penn operates 43 casinos and racetracks across 20 U.S. states, according to its website. It also offers online sports betting and online casino gambling in several locations.
Last year, Penn struck a $1.5 billion licensing deal with Disney that allowed the casino operator to use ESPN's brand in its online sportsbook. As part of the deal, Penn's rights to the ESPN Bet brand will initially run for 10 years, while ESPN has been granted rights worth about $500 million to purchase Penn stock.
The early success of the ESPN deal has bolstered Penn CEO Jay Snowden after a soured acquisition. Penn spent $550 million to acquire Barstool Sports only to sell it back to its founder Dave Portnoy for $1 last year.
Penn also acquired Canada's Score Media and Gaming for $2.1 billion in 2021.
Some activist investors, including Donerail Group, have criticized Penn for spending billions on dollars on its digital business without prospects for strong returns, and have called on the Wyomissing, Pennsylvania-based company to explore a sale.
Last week, Truist Securities analysts wrote in a research note that it was unlikely Penn's management would abandon its operational plan to explore a sale.
"Despite the activist letter, we don’t think any sort of formal strategic review at Penn is likely in the near-term with a clear ESPN Bet product roadmap; football season on the horizon; and higher/volatile interest rates still impacting overall M&A for now," the Truist analysts wrote.
Based in Las Vegas, Boyd has 28 gaming entertainment properties in 10 U.S. states, manages a tribal casino in northern California, and operates an online casino gaming business. It also has a 5% stake in sports-betting operator FanDuel Group.
A combination between Boyd and Penn would need the sign-off from several constituents other than Disney, including gaming regulators in the several states and landlords such as Gaming & Leisure Properties GLPI.O.
Boyd's casino operations overlap with Penn in some states, so Boyd would also likely be forced to divest some operations in those locations, the sources said.
Reporting by Milana Vinn and Anirban Sen in New York; Editing by David Gregorio
Mga Kaugnay na Asset
Pinakabagong Balita
Disclaimer: Ang mga kabilang sa XM Group ay nagbibigay lang ng serbisyo sa pagpapatupad at pag-access sa aming Online Trading Facility, kung saan pinapahintulutan nito ang pagtingin at/o paggamit sa nilalaman na makikita sa website o sa pamamagitan nito, at walang layuning palitan o palawigin ito, at hindi din ito papalitan o papalawigin. Ang naturang pag-access at paggamit ay palaging alinsunod sa: (i) Mga Tuntunin at Kundisyon; (ii) Mga Babala sa Risk; at (iii) Kabuuang Disclaimer. Kaya naman ang naturang nilalaman ay ituturing na pangkalahatang impormasyon lamang. Mangyaring isaalang-alang na ang mga nilalaman ng aming Online Trading Facility ay hindi paglikom, o alok, para magsagawa ng anumang transaksyon sa mga pinansyal na market. Ang pag-trade sa alinmang pinansyal na market ay nagtataglay ng mataas na lebel ng risk sa iyong kapital.
Lahat ng materyales na nakalathala sa aming Online Trading Facility ay nakalaan para sa layuning edukasyonal/pang-impormasyon lamang at hindi naglalaman – at hindi dapat ituring bilang naglalaman – ng payo at rekomendasyon na pangpinansyal, tungkol sa buwis sa pag-i-invest, o pang-trade, o tala ng aming presyo sa pag-trade, o alok para sa, o paglikom ng, transaksyon sa alinmang pinansyal na instrument o hindi ginustong pinansyal na promosyon.
Sa anumang nilalaman na galing sa ikatlong partido, pati na ang mga nilalaman na inihanda ng XM, ang mga naturang opinyon, balita, pananaliksik, pag-analisa, presyo, ibang impormasyon o link sa ibang mga site na makikita sa website na ito ay ibibigay tulad ng nandoon, bilang pangkalahatang komentaryo sa market at hindi ito nagtataglay ng payo sa pag-i-invest. Kung ang alinmang nilalaman nito ay itinuring bilang pananaliksik sa pag-i-invest, kailangan mong isaalang-alang at tanggapin na hindi ito inilaan at inihanda alinsunod sa mga legal na pangangailangan na idinisenyo para maisulong ang pagsasarili ng pananaliksik sa pag-i-invest, at dahil dito ituturing ito na komunikasyon sa marketing sa ilalim ng mga kaugnay na batas at regulasyon. Mangyaring siguruhin na nabasa at naintindihan mo ang aming Notipikasyon sa Hindi Independyenteng Pananaliksik sa Pag-i-invest at Babala sa Risk na may kinalaman sa impormasyong nakalagay sa itaas, na maa-access dito.
