Penn National Gaming could buy stake in Maryland casino

Posted Sept. 26, 2012, at 7:42 p.m.

 

Penn National Gaming is in talks with the owners Maryland Live!, the state’s largest casino, about acquiring a significant minority stake in the operation, according to two state officials familiar with the talks.

The arrangement has the potential not only to shake up the ownership structure of Maryland’s fledgling casino industry, but also to affect a campaign over a gambling-expansion plan that will appear on the state’s November ballot.

Maryland Live! is owned by a spinoff of the Cordish Cos., a Baltimore-based developer and entertainment firm. The casino, located at Arundel Mills mall in Anne Arundel County, grossed more than $96 million in gaming revenue during its first three months of operation.

Neither Cordish nor Penn officials immediately responded to requests for comment on a potential deal, which would require state approval. The state officials interviewed by The Washington Post requested anonymity to more freely discuss their understanding of the deliberations.

Penn, which operates 27 gaming and racing venues in the United States and Canada, including Hollywood Casino in Bangor, Maine, already has several interests in Maryland’s gaming market. It owns a small casino in Cecil County, as well as Rosecroft Raceway, a horse track in Prince George’s County where the company has been angling to put another casino.

Penn, however, so far has spent $13 million to defeat the expansion plan on the ballot, which would allow a casino in Prince George’s County, as well as table games, such as blackjack and roulette, at Maryland’s previously authorized slots locations.

Company officials say the plan is flawed and the deck is stacked against them in Prince George’s because the county executive and other officials have championed National Harbor as a better location for a casino.

Penn also owns a large casino in Charles Town, W.Va., which analysts says would take a hit if a new venue opens at National Harbor.

Acquiring a significant stake in Maryland Live! would force some other decisions for Penn. Under Maryland law, companies may not have an ownership stake of more than 5 percent in more than one casino.

That could force Penn to sell its Cecil casino or somehow restructure its ownership. It would also an attempt to win a gambling license for Rosecroft more difficult to navigate.

Cordish has not taken a position on the referendum but vocally opposed the expansion plan when it was debated during a special legislative session this summer. Cordish argued a Prince George’s casino would unfairly cut into its share of Washington-area customers.

Cordish has yet to report spending any money on this year’s ballot measure.

Washington Post staff writer Jonathan O’Connell contributed to this report.

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