Pinnacle Entertainment has agreed to purchase the Sands Casino Hotel in Atlantic City, and plans to tear down the city’s smallest casino and replace it with a newer, larger gaming hall.
Pinnacle, which owns casinos in Nevada, Louisiana and Indiana, has agreed to pay $250 million, plus $20 million for tax benefits and real estate assets, for Carl Icahn’s Atlantic Coast Entertainment, the company that owns the 26-year-old Sands and the nearby Traymore hotel site.
The casino, which employs roughly 2,100 workers, will likely close by mid-November, president and CEO George Toth said last week.
"We have the closing of a fabled Atlantic City gaming house, which we plan to do in style and in a celebratory manner throughout the next 60 days," Toth said.
Pinnacle said it plans to move quickly in tearing down the Sands once the casino is shut down.
The company’s plans for a new casino have not been released, but the project is expected to last several years and make the most of the 18-acre parcel on and near the Boardwalk, with a mega-resort casino-hotel costing upward of $1 billion.
"Atlantic City is one of the top U.S. gaming destinations, and we’re looking forward to being a part of the world-famous Boardwalk," said Daniel R. Lee, Pinnacle’s chairman and chief executive officer. "This major new resort will be a key component in our plan to build a national network of gaming properties. It will also help extend our development pipeline and our company’s growth through 2010 and beyond. In connection with our longstanding interest in Atlantic City, we submitted our initial license application in New Jersey several months ago. The regulatory investigation is ongoing.
"While we regret the necessity of closing the Sands to create an exciting new resort, we look forward to working with gaming regulators, state and local authorities on this project to create more jobs, tax revenues and other lasting benefits for the region," Lee continued.
The transaction is subject to the satisfaction of customary closing conditions. Pinnacle expects to close its purchase of The Sands/Traymore site by the end of the year.