When the late harness racing Hall of Famer Eddie Keller opened little Pocono Downs some four decades ago, little could he have guessed that the track in Wilkes-Barre, Pa., would some day be sold for $280 million.
But that’s exactly the price the Mohegan Tribal Gaming Authority has agreed to pay Penn National Gaming Inc. (PENN) for the five-eighths mile track. The attraction, of course, is the hope that it will be granted a gaming license with the prospect of installing 3,000 slot machines at the track.
This will be the first move by the Mohegan Tribe to expand its gaming operations beyond its Mohegan Sun Hotel/Casino in Connecticut.
"The acquisition of Pocono Downs represents an important step in our long-term diversification strategy," said, Mark F. Brown, the Mohegan Authority’s chairman.
"We are very excited about this project, not only because it is our first commercial gaming venture, but also because it will be a tremendous benefit to the local community and the commonwealth as a whole."
In addition to the track, the tribe also is acquiring five Pennsylvania off-track wagering operations, including the state’s largest in Allentown.
Under the Mohegan’s plans, the Authority will apply for a slot machine license, pay the state a one-time charge of $50 million, and then spend $175 million on the construction, furnishing and equipping of a new facility. The project, according to Billy Velardo, president and CEO, is expected to be operational in early 2006.