After P2E acquisitions and online market exit

Churchill Downs buys Chasers Poker Room in NH; expands HHR operations to fourth state

Chasers Poker Room in Salem, New Hampshire.
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Gaming company and horse racing giant Churchill Downs Inc. (CDI) announced on Tuesday that it has signed a definitive agreement to acquire Chasers Poker Room in Salem, New Hampshire. The acquisition of New Hampshire’s leading charitable gaming operation paves way for CDI to expand its Historical Horse Racing (HHR) operations into a fourth state.

Chasers, a charitable gaming facility located approximately 30 minutes from downtown Boston, offers poker and a variety of table games to its guests. Since opening in 2017, it has led all New Hampshire charitable gaming operators in both gaming revenue and local charitable contributions, a press release explains.

In 2021, New Hampshire authorized existing charitable gaming operators to offer historical horse racing at licensed facilities. Following the closing of the acquisition, CDI plans to develop an expanded charitable gaming facility in Salem to accommodate historical racing machines (HRMs).

“New Hampshire is an exciting opportunity for us, one that allows us to put our historical racing machine expertise to work in the growing New England market,” said Bill Carstanjen, Chief Executive Officer of CDI. “We look forward to sharing more about our plans to build an expanded, state-of-the-art gaming facility in Salem in the coming months.”

Under New Hampshire law, a portion of revenue from charitable gaming operations is allocated to nonprofit organizations licensed in the state. The transaction is dependent on usual and customary closing conditions, including the company obtaining approvals from the New Hampshire Lottery Commission: it is expected to close during the second quarter of 2022.

Upon closing, New Hampshire will become the fourth state in which the Kentucky Derby operator runs historical horse racing. The company currently has HRMs in Kentucky and has plans in place to operate HRMs in Virginia and in Louisiana.

The Louisiana operations will come upon completion of the HRM expansion into the company’s 14 existing off-track betting facilities. Meanwhile, CDI’s upcoming HRMs operations in Virginia will come into effect upon closing of a pending acquisition of operator Peninsula Pacific Entertainment, including its affiliated Rosie’s Gaming Emporium HRM facilities. 

Churchill Downs first announced it had entered a definitive agreement to acquire substantially all of the assets of casino and hospitality business Peninsula Pacific Entertainment (P2E) for total consideration of $2.48 billion last month.

The deal is set to expand the geographic footprint of CDI’s live and historical racing entertainment venues and significantly increase the scale of business. Churchill Downs will acquire all of P2E’s assets in Virginia and New York, including Colonial Downs Racetrack and Rosie’s Gaming Emporium, plus operations of the Hard Rock Sioux City casino property in Iowa.

The transaction is expected to close “by the end of 2022,” according to Churchill Downs. The operator will have to secure appropriate approvals from gaming commissions in all three states involved, and CDI will fund the P2E transaction with a combination of new debt and cash on hand, including pending proceeds from a sale of land near Calder Casino

In late February, Churchill Downs said it is exiting the online casino and sports betting businesses, but the Kentucky Derby operator noted it will still maintain its web-based horse betting operations. CDI’s departure from the sports gaming vertical will happen over the next six months.