Churchill Downs Secures Major Casino Deal with Colonial Downs Acquisition

Churchill Downs Incorporated Acquires Peninsula Pacific Entertainment: A Game-Changing Deal in the Gaming Industry

Churchill Downs Incorporated (CDI) has recently unveiled its plans to acquire Peninsula Pacific Entertainment (P2E), the parent company of Colonial Downs, in a groundbreaking deal worth $2.485 billion. This acquisition is set to make waves in the gaming industry, expanding CDI’s already impressive racetrack roster. With a combination of new debt and cash on hand, CDI aims to close the deal by the end of 2022, with part of the funding coming from the sale of land near Calder Casino in Florida.

Colonial Downs: A Record-Breaking Racing Season

As part of the acquisition, CDI will gain ownership of Colonial Downs, a highly successful and renowned racetrack located in New Kent, Virginia. In 2021, Colonial Downs experienced an unprecedented racing season, boasting an exceptional average daily handle of $2,240,000. This record-breaking season drew in significant interest, with strong fields featuring an average of 8.36 horses per race, contributing to a staggering $10.4 million in purses over a 21-day card.

Building on this success, Colonial Downs has received approval from the Virginia Racing Commission to extend its racing season to 27 days for the current year. The season is scheduled to commence on July 11 and run through to September 7, providing racing enthusiasts with an extended period of thrilling horse racing action.

The Expansion of CDI’s Gaming Empire

Besides gaining control over Colonial Downs, CDI’s acquisition of P2E opens doors to a variety of notable gaming assets. Notably, CDI will take ownership of six historical horse racing (HHR) gaming facilities located in Virginia, operating under the well-known brand name “Rosie’s Gaming Emporium.” Additionally, CDI secures the rights to develop up to five additional HHR facilities across the state of Virginia, positioning the company for future growth.

One of the most significant aspects of this acquisition is CDI’s acquisition of the “Dumfries Project,” an ambitious undertaking set to become a large gaming resort in the prosperous Northern Virginia area. P2E had originally planned to invest over $400 million in the Dumfries Project, which will now be executed by CDI. The resort aims to house up to 1,800 HHR machines, providing visitors with an unparalleled gaming experience in a prime location.

Expanding its diverse range of assets, CDI will also obtain the del Lago Resort & Casino in Waterloo, New York, and assume operations of the Hard Rock Hotel & Casino in Sioux City, Iowa. As part of the deal, P2E is expected to sell the real estate under the Hard Rock property to a third party, who will then lease the property to CDI.

Looking Ahead: The ONE Casino + Resort Project

In addition to these remarkable developments, CDI gains exclusive rights to P2E’s plans to develop ONE Casino + Resort, an ambitious $565 million resort and casino project in Richmond, Virginia. This venture is a partnership between P2E and Urban One, showcasing a strategic collaboration between influential industry players.

CDI’s CEO, Bill Carstanjen, expressed his enthusiasm for the acquisition and the future growth opportunities it presents. He acknowledged the exceptional work done by P2E in developing and managing these assets, and highlighted CDI’s dedication to strategically expanding and maximizing their potential in the years to come.

This groundbreaking acquisition not only strengthens CDI’s geographic footprint but also positions the company as a major player in the gaming industry. With an expanded portfolio of gaming facilities and ambitious development projects, CDI is poised to reshape the landscape of gaming and entertainment, offering unparalleled experiences to visitors from around the world.

Frequently Asked Questions

1. What is the timeline for the completion of the acquisition?

The acquisition is expected to be finalized by the end of 2022.

2. How will CDI fund the acquisition?

CDI plans to finance the acquisition through a combination of new debt and cash on hand, with a portion of the funds coming from the sale of land near Calder Casino in Florida.

3. What are the benefits of this acquisition for CDI?

This acquisition allows CDI to expand its geographic footprint, gain ownership of highly successful gaming facilities, and secure the rights to develop new facilities. It positions CDI for strategic growth and enhances its presence in the gaming industry.

4. What is the significance of the Dumfries Project?

The Dumfries Project is a high-profile gaming resort development in Northern Virginia, set to house up to 1,800 HHR machines. CDI’s acquisition of this project demonstrates the company’s commitment to creating exceptional gaming experiences in a prosperous market.

5. What impact will ONE Casino + Resort have on the gaming industry?

ONE Casino + Resort is an ambitious $565 million project that aims to redefine the casino and resort experience in Richmond, Virginia. The collaboration between P2E and Urban One signals a significant effort to revolutionize the gaming and entertainment landscape, attracting visitors and driving economic growth in the region.

Conclusion

The acquisition of Peninsula Pacific Entertainment by Churchill Downs Incorporated represents a transformative move in the gaming industry. CDI’s strategic acquisition not only adds highly successful racetracks, gaming facilities, and development projects to its portfolio but also positions the company for future growth and expansion. With a strong focus on providing exceptional gaming experiences and maximizing the potential of its assets, CDI is set to make a lasting impact in the gaming and entertainment landscape.

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Doug I. Jones

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