Gaming regulators approve Penn National purchase of Tropicana

The Wyomissing, Pa.-based company, which also owns M Resort in Henderson, will finally land an address on the Strip after years of rumors that it would purchase various properties. Penn National operates 26 casinos and racetracks nationwide and has a 3 million-member customer database. The Tropicana will fill a void in the company's portfolio.

"We have spent many years looking for the right presence on the Las Vegas Strip," Penn National CEO Tim Wilmott told the Nevada Gaming Commission in Las Vegas.

Wilmott said the company could spend $200 million in the next four years to upgrade the Tropicana. "We were pleasantly surprised by the condition of the rooms when we toured the property," Wilmott said.

Initially, Penn National will spend $20 million on the Tropicana after closing the deal to integrate the company's player database into the casino. The company will not rebrand the Tropicana as a one of the company's Hollywood-themed properties.

"We thought there might be some confusion with Planet Hollywood," Wilmott said before the meeting. Planet Hollywood Hotel-Casino is operated by Caesars Entertainment on the Strip. "We like the name Tropicana," Wilmott said.

The 1,500-room Tropicana produced $100 million in total annual revenue, $40 million of which came from the casino. Penn National also plans to upgrade the slot machine floor.

The Nevada Gaming Commission had few concerns about the transaction, which was originally announced in April.

Penn executives said 25 percent of the company's customers regularly visit Las Vegas. Penn National has owned the 390-room M Resort since 2011 and attracts some that business to the hotel-casino. However, M Resort is located about 10 miles from the heart of the Strip.

Wilmott said some of the group business the company has cultivated at M Resort has outgrown the property. He thought much of that business could transfer to the Tropicana.

Last month, Penn named Bob Sheldon as president of the company's Las Vegas properties. He was general manager of Hollywood Casino at Kansas Speedway, which he helped open in February 2012.

Sheldon began his gaming career in Las Vegas at the Las Vegas Hilton and with Mirage Resorts, including serving as president of the Golden Nugget. He also oversaw the Foxwoods in Connecticut.

Penn National is also spending $390 million to build a Hollywood-branded Indian casino near San Diego.