Las Vegas’ iconic Stratosphere Casino is under new management as part of the $850m sale of American Casino & Entertainment Properties (ACEP) to Golden Entertainment.
On Monday, gaming operator Golden Entertainment announced it would pay $781m in cash plus 4m shares of Golden stock to acquire ACEP, which owns the Stratosphere and three other Nevada gaming properties – Arizona Charlie’s Decatur, Arizona Charlie’s Boulder and the Aquarius Casino Resort in Laughlin.
The deal, which the participants expect to conclude later this year, will significantly expand Golden’s operations, which currently include the PT’s Pub chain of taverns in Nevada, three brick-and-mortar Nevada casinos, plus Maryland’s Rocky Gap Resort and the Golden Route Operations, which controls 10,500 slot machines at nearly 1000 small venues in Nevada and Montana.
Golden says ACEP is on target to generate revenue of $413m and earnings of $103m this year, and Golden expects the deal will be immediately accretive to its operating results. Golden also says it expects to achieve around $18m in annual synergies once it seals the deal.
Golden’s expanded gaming portfolio will consist of over 15,800 slots, 114 table games and 5,100 hotel rooms across eight casinos as well as the pubs and slots route. Golden believes its beefed up operations will generate revenue of $847m and earnings of $180m in 2017.
Golden’s chairman and CEO Blake Sartini called the acquisition “a transformational event” for his company that presents “several opportunities to cross-market and promote these new assets that we welcome to the Golden family.”
Acquiring the Stratosphere not only gives Golden its first presence on the north end of the Las Vegas Strip, the company also now has multiple options to consider for the roughly 15 acres of what Sartini called “excess real estate” surrounding the casino.
Golden’s ACEP deal is the latest move in a wave of consolidation that has gripped the Nevada locals market in recent years, including moves by Boyd Gaming and Red Rock Resorts (aka Station Casinos) to tighten their hold on off-Strip gaming activity.
