Wind Creek Hospitality‘s acquisition of the Sands Resort and Casino in Pennsylvania is “ongoing and on track,” according to the firm, a unit of the Poarch Band of Creek Indians of Alabama. The tribe is hoping to get the necessary approvals and close the $1.3 billion deal later this year or in the early part of 2019. (Courtesy Wind Creek)
The acquisition of the Sands Casino Resort in Pennsylvania by a unit of the Poarch Band of Creek Indians of Alabama is on track, and the new operation likely will include online gaming for money.
Meanwhile, the tribe does not seem alarmed by potential competition from giant casino operator MGM, which is buying a gaming operation in Yonkers, New York, less than 100 miles away from the Sands.
James Dorris, chief executive and president of tribal gaming venture Wind Creek Hospitality, noted that regulatory approvals for the Sands may take more than a year. Wind Creek agreed to buy the Bethlehem, Pennsylvania, facility in March. The approvals process for the $1.3 billion deal is “ongoing and on track,” Dorris said.
Pennsylvania is one of only four states that currently offer online play for money (the others are neighboring states New Jersey and Delaware, plus Nevada).
“Online play for money is part of the gaming environment in Pennsylvania and it is likely that we will provide an online venue through which customers in Pennsylvania can play for money,” Dorris said.
The deal represents a significant regional expansion for the tribe, which owns nine other gaming properties in the South, Nevada and the Caribbean, including three casinos on the tribe’s reservation in Alabama.
“Diversification of our business efforts across regions is an important part of our strategy and this acquisition will provide our product to customers who previously had little or no access [to it],” Dorris said.
The move into the Northeast with the Sands has the tribe thinking about further expansion.
“We believe there remains great potential with the property and will consider expansion possibilities when appropriate,” said Dorris, who said the tribe was “pleased” with the current performance of the Sands.
A marketing possibility the tribe sees is in giving Sands customers from the cold Northeast a chance to redeem their Wind Creek Rewards for stays in Wind Creek’s Caribbean resorts.
MGM is reportedly paying $850 million for the Empire City Casino and Yonkers Raceway in Yonkers, which is just north of New York City and was owned by the Rooney family. MGM originally planned to buy the Sands, but that deal never closed. It is also reportedly opening a casino in Massachusetts.
Dorris does not appear worried by the potential competition from MGM, and even paid them a compliment.
“MGM is a quality operator and they will do great things with that property. The region is already highly competitive and we will work to assure that we are successful,” he said.
The tribe expects the deal to close later this year or in 2019. Its other properties include Wind Creek Atmore, Wind Creek Wetumpka, and Wind Creek Montgomery in Alabama, Wa She Shu Casino in Nevada, Renaissance Aruba Resort & Casino, and Renaissance Curacao Resort & Casino as well as racetracks in Alabama and Florida.
Amenities at the Sands, a Las Vegas-style casino which is about 80 miles from New York City and 97 from Empire City, “include a 282-room AAA four diamond hotel, a 183,000 square foot casino floor featuring 3,000 slots and electronic table games, 200 table games, numerous food and beverage outlets, a 150,000 square foot retail mall, and a multi-purpose event center,” according to Wind Creek.
Wind Creek said it expects to fund the acquisition with a combination of existing cash and new debt. It said Credit Suisse has provided financing for the proposed transaction. Wind Creek will use the additional cash flow from the acquisition to pay down debt on an accelerated basis.
Innovation Capital, LLC is exclusive financial advisor and Cooper Levenson P.A. is legal counsel to Wind Creek Hospitality in connection with the Sands transaction.