US: Gaming saints reach $4.75 billion merger agreement

Gaming and Leisure Properties Inc. said Tuesday it will acquire the real estate owned by casino operator Pinnacle Entertainment for $4.75 billion in an all-stock transaction and lease the properties back to the Las Vegas-based company.

The transaction had long-been anticipated after Pinnacle announced plans last year to spin-off its casinos into a real estate investment trust. GLPI, a gaming industry REIT spun off from Penn National Gaming, made two offers in the past few months to acquire Pinnacle. The companies had been in negotiations since March.

The transaction, which requires shareholder and regulatory approval, is expected to close in early 2016.

GLPI is acquiring Pinnacle‘s 14 properties in seven states, giving the REIT 35 casino and hotel resorts across 14 states. GLPI will lease 18 of its properties to Penn National, 14 to Pinnacle and one to Casino Queen in East St. Louis, Ill. A GLPI subsidiary operates two casinos in Baton Rouge, La., and Perryville, Md.

Pinnacle will operate the casinos under a lease agreement with GLPI and will initially pay the REIT $377 million in rent in the first year.

GLPI Chairman and CEO Peter Carlino said the deal creates “the third largest publicly traded triple-net REIT” in the REIT industry.

Full content: Globe St.

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