Churchill Downs completes purchase of Midwest Gaming
US racetrack and casino operator Churchill Downs Incorporated (CDI) has finalised its acquisition of certain ownership interests of Midwest Gaming Holdings, the parent company of Rivers Casino Des Plaines in Illinois.
CDI will pay approximately $407m (£309.9m/€360.0m) for the assets, after securing approval from the Illinois Gaming Board to proceed with the deal.
The operator will fund the purchase with cash on hand and through an existing credit facility.
Located 15 miles from downtown Chicago, Rivers Des Plaines has a 44,000 square foot single-level gaming floor with 983 slot machines and 58 table games. The venue also boasts seven dining and entertainment options and a multi-functional event centre.
Speaking at the original announcement of deal in October, CDI chief executive Bill Carstanjen said the agreement reflects the company’s strategy of investing in gaming properties with stable, predictable cash flows in diverse markets.
Carstanjen also said CDI is focused on acquisition opportunities in populous states that may ultimately grant access to online casino gaming and sports betting to brick-and-mortar casino licence-holders.
Illinois has not yet legalised sports betting or online gaming, but coming state Governor J.B Pritzker last month raised hopes of legal sports betting in Illinois after including $200m in future tax revenue from wagering activities in his 2020 budget proposal.
“This property is the crown jewel of Illinois gaming and one of the country’s premier casinos,” Carstanjen said. “This is an exciting opportunity for CDI, given Rivers Des Plaines’ superior design, unparalleled location in the Chicagoland market, high-quality amenities and outstanding team.”
Confirmation of the deal comes after CDI last week posted its results for 2018, revealing a 14.3% year-on-year increase in revenue. For the year to December 31, 2018, revenue grew to $1.01bn.
CDI noted growth within its casino division, with revenue up 17.3% to $411.2m. This operating segment was boosted by a number of developments, namely CDI consolidating the Ocean Downs racino in Saratoga, New York from September 1, 2018, which contributed an additional $25.9m to the full-year total.
Last month, CDI also announced the latest step of its sports betting expansion strategy in the US by launching its SBTech-powered BetAmerica brand in the state of New Jersey, via a partnership with Atlantic City’s Golden Nugget Casino.
BetAmerica now offers both online real-money sports betting and casino gaming to consumers in the state.