Penn Entertainment, Inc., formerly Penn National Gaming, is an American entertainment company and operator of integrated entertainment, sports content, and
casino gambling. It operates 43 properties in 20 states, under brands including Hollywood Casino, Ameristar, and Boomtown. It also offers
sports betting in 15 jurisdictions and
online casino gaming in 5, under brands such as
ESPN BET and
theScore.[1]
History
Background and early history (1968–1994)
Beginning: Pitt Park Raceway, Inc. and the Pennsylvania National Turf Club
In 1967, Pennsylvania enacted a law allowing
thoroughbred horse racing with
parimutuel wagering.[2] Two companies that later formed part of Penn National Gaming were founded in 1968 by groups seeking one of the four available racing licenses: Pitt Park Raceway, Inc., formed by several
Erie area businessmen,[3][4] and the Pennsylvania National Turf Club, established by a group of Central Pennsylvania investors.[5][6] The Turf Club was awarded one of the licenses, and soon began construction on
Penn National Race Course.[7][6] The complex included a motor speedway, which held its first races in 1971,[8][9] and the horse track, which opened in 1972.[10][11]
Pitt Park Raceway, meanwhile, was denied in its initial application, but received one of a second round of licenses issued in 1970.[4][12] The first Pitt Park racing meet opened in 1971 at
The Meadows, an existing
harness racing track.[13] Pitt Park lost half a million dollars in its first meet, leading its owners to sell the company to a group of investors, including Philadelphia insurance businessman Peter D. Carlino.[14][15] After another unsuccessful season at The Meadows, Pitt Park changed its name to the Mountainview Thoroughbred Racing Association and moved to Penn National Race Course.[16][17] Starting in 1973, as a tenant of the Turf Club, Mountainview held 100 nights of racing there each year.[17][18]
Reorganization and renaming to Penn National Gaming
In 1982, Carlino purchased Penn National Race Course from the financially struggling Turf Club.[19][20] The Turf Club continued to operate its own racing meet each year, now as a tenant of Carlino.[20]
The companies involved with Penn National Race Course were reorganized in 1994 in preparation for an
initial public offering.[21] PNRC Corp., which had been incorporated in 1982, was renamed as Penn National Gaming, with Mountainview and the Turf Club as its subsidiaries.[21] Carlino's son, Peter M. Carlino, who had earlier managed Mountainview, was Penn National's first CEO,[22][23] a position he held until 2013.[24] In May 1994, Penn National Gaming became a
public company via an
initial public offering on the
Nasdaq, raising $18 million to pay down debt and fund construction of
off-track betting parlors.[25][26]
Expansion (1996–2021)
Penn National expanded beyond its first racetrack with the acquisitions of
Pocono Downs in 1996,
Charles Town Races in 1997, and, in 1999, a half interest in
Freehold Raceway and the operations of
Garden State Park.[27] Penn National also won approval to begin offering slot machines at Charles Town in 1997.[28]
In 2003, Penn National bought
Hollywood Casino Corp. for $328 million plus $360 million in assumed debt, gaining three casinos in
Aurora, Illinois;
Tunica, Mississippi; and
Shreveport, Louisiana.[33] The acquisition, which doubled Penn National's revenues, was part of a continuing strategy to shift away from the horse racing business and into the casino business.[34] The company planned to rebrand its other properties under the Hollywood Casino name.[34]
In 2005, Penn National acquired
Argosy Gaming Company for $1.4 billion plus $791 million in assumed debt, adding five casinos and one horse track to its portfolio (not including the
Argosy Baton Rouge, which was quickly sold to satisfy
antitrust concerns).[35][36] The purchase again doubled Penn National's size, making it, at the time, the third largest publicly held gaming company in the country (behind
MGM Mirage and
Harrah's Entertainment).[37]
In November 2006, a deal for Penn National Gaming to acquire Harrah's Entertainment fell through.[38]
In 2011, Penn National acquires the
M Resort, its first property in Nevada.
In November 2012, the company announced a plan to spin off a new
real estate investment trust (REIT) with ownership of most of its properties, in an effort to reduce taxes and cost of capital, and overcome license ownership restrictions.[41][42] The REIT owned the land and buildings for 21 of Penn National's 29 casinos and racetracks; Penn National continued to operate all but two of the properties under a lease agreement.[43] The spin-off was completed on November 1, 2013, creating
Gaming and Leisure Properties, Inc. (GLPI).[44] As of June 2022, the GLPI trust owned over 50 casino properties, which it leased to companies including Caesars Entertainment, Boyd Gaming Corp., Casino Queen, and Cordish Cos.[44]
In July 2013, Penn National sold the Bullwhackers Casino to a local investor group.[45][46]
In August 2016, the company agreed to purchase
Rocket Games for $60 million.[48]
In May 2017, Penn National acquired the operating assets of
Bally's Casino Tunica and
Resorts Casino Tunica for a total of $44 million, and leased the two casinos from GLPI, which had simultaneously purchased the real estate assets.[49][50][51]
In October 2018, the company acquired
Pinnacle Entertainment for $2.8 billion in cash and stock.[52][53] To ensure regulatory approval for the deal, Pinnacle sold four of its properties to
Boyd Gaming prior to the merger.[52][54] The result was the addition of twelve new properties to Penn National's holdings, all of them leased from GLPI. In connection with the sale, Penn National sold the real estate of
Plainridge Park Casino to GLPI for $250 million.[55]
In 2019, Penn National made two purchases in conjunction with
Vici Properties. Penn National bought the operating businesses of the
Margaritaville Resort Casino in Louisiana and
Greektown Casino–Hotel in Detroit for $115 million and $300 million, respectively, while Vici bought both properties' real estate assets and leased them to Penn.[56][57]
On January 29, 2020, Penn purchased a 36% stake in
Barstool Sports for $163 million.[58]
During the
COVID-19 pandemic, Penn faced the prospect of financial issues brought on by resort closures. As a result, Penn sold the land occupied by the Tropicana Las Vegas to GLPI.[59] Penn sold the land for $337.5 million in rent credits, and the sale was finalized in April 2020. Penn continued to operate the Tropicana until 2022, when it was sold to
Bally's Corporation.[60][61] Throughout 2021, Penn launched its Barstool Sportsbook mobile app in twelve states.[62] This included Pennsylvania, Michigan, Illinois, Iowa, New Jersey, and Indiana.[63] The app provides online sports betting for 20 sports.[64]
In August 2021, Penn National agreed to acquire
Score Media and Gaming, a digital media company, for $2 billion.[65][66] The companies have had a strategic partnership since 2019.[67] Score Media operates theScore app, a top sports media app, which provides sports scores, news, and betting information to users.[64]
In September 2021, the company opened a career center at Hollywood Casino Morgantown.[68]
Penn Entertainment (2022 to present)
In February 2022, Penn National announced a strategic partnership with Sports Betting Exchange in Louisiana.[69] In April 2022, theScore’s online sports betting platform and app, theScore Bet, started taking bets in Canada and became the official gaming partner of the Toronto Blue Jays.[70]
In August 2022, the company changed its name to Penn Entertainment to reflect its diversification into sports content and other entertainment.[71] In February 2023, Penn acquired the remainder of Barstool Sports for $388 million.[72]
In August 2023, Penn reached a ten-year, $2 billion agreement with
ESPN Inc., under which Penn will rebrand Barstool Sportsbook as "ESPN Bet". To license the branding, Penn will pay $1.5 billion in cash, and give ESPN $500 million in shares. Concurrently, Penn announced that it would sell Barstool back to its founder
David Portnoy for $1 and 50% of future sales of the Barstool brand which Portnoy claimed he will solely own "until I die.".[73][74]