LAS VEGAS, Nov. 16 /PRNewswire-FirstCall/ -- Pinnacle Entertainment, Inc. today announced it has joined with entrepreneur Robert L. Johnson as an equity partner in its pursuit of a license for a gaming facility in Philadelphia. The agreement formalizes a letter of intent that the partners signed in July.
Johnson is the founder of Black Entertainment Television (BET), the first African American-owned company listed on the New York Stock Exchange. He is believed to be the country's first African American billionaire following the sale of his media holdings to Viacom Inc. in 2000. He is now the nation's largest African American hotelier and has interests in a spectrum of industries, including gaming interests in the Caribbean. The RLJ Companies, Johnson's holding company, owns businesses in the media and entertainment and financial services industries, including Caribbean Gaming and Entertainment, several private equity funds, a hedge fund of funds, Urban Trust Bank, Our Stories Films, and an NBA franchise, the Charlotte Bobcats.
"We're excited about our partnership with Mr. Johnson, one of the country's leading businessmen and a legend in the entertainment industry," said Daniel R. Lee, Pinnacle's Chairman and Chief Executive Officer. "His expertise in communications, hospitality and entertainment will bring significant additional experience to our project. Our discussions began several months ago, and we are pleased to make our alliance official."
If approved by the Pennsylvania Gaming Control Board, Mr. Johnson would own approximately one-third of the proposed casino. "Our interests in the hospitality and gaming industries are an excellent fit with Pinnacle's goals for this project as an urban entertainment destination," Johnson said. "We bring additional financial strength and management expertise to the table. We view Pinnacle as the right partner based on their experience in both the development and operations of casinos and their commitment to minority participation."
"The Philadelphia market presents a remarkable investment and a chance to be a key part of the renaissance of one of America's great cities," Johnson continued. "We want to help Pinnacle create quality entertainment and a focal point that the city richly deserves."
Pinnacle has applied for a license to operate a casino along the North Delaware riverfront in the Fishtown neighborhood. The company has proposed a gaming entertainment complex that includes a multiscreen movie theatre, water feature/ice skating rink, a premier floating restaurant and a variety of eateries as well as retail shops and a walking path/promenade. The initial phase of the project is budgeted at between $300 million and $400 million.
About Pinnacle Entertainment
Pinnacle Entertainment owns and operates casinos in Nevada, Louisiana, Indiana, Argentina and the Bahamas, owns a hotel in Missouri, and has significant insurance claims related to a hurricane-damaged casino previously operated in Biloxi, Mississippi. Pinnacle also has two casino development projects under construction in the St. Louis, Missouri area, which are dependent upon final approval by the Missouri Gaming Commission. Pinnacle recently agreed to purchase a casino site at the heart of the famed Boardwalk in Atlantic City.
About RLJ Companies
The RLJ Companies ("RLJ"), founded by Robert L. Johnson, founder of Black Entertainment Television, provides strategic investment and direction in and for a diverse portfolio of companies in the financial services, real estate, hospitality/restaurant, professional sports, film production, gaming and recording industries. The RLJ Companies' core businesses include RLJ Development (a privately held hotel real estate investment company) and RLJ Urban Lodging Funds I and II, hotel private equity funds which together have over $2 billion in combined assets; RLJ Select Investments, LLC, a hedge fund of funds joint venture with Deutsche Bank AG; RLJ Equity Partners, LLC, a private equity fund formed in partnership with The Carlyle Group; The NBA Charlotte Bobcats and Charlotte Arena Operations; Caribbean Gaming and Entertainment (C.A.G.E.), a video lottery terminal company; Urban Trust Bank and Urban Trust Educational Finance; Rollover Systems, Inc., a retirement services company; and Three Keys Music, a jazz recording company. For further information, visit http://www.rljcompanies.com/.
All statements included in this press release, other than historical information or statements of historical fact, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including statements regarding the Company's application for a gaming license in Pennsylvania, construction projects, potential job creation, and new development opportunities, are based on management's current expectations and are subject to risks, uncertainties and changes in circumstances that could significantly affect future results. Accordingly, Pinnacle Entertainment cautions that the forward-looking statements contained herein are qualified by important factors that could cause actual results to differ materially from those reflected by such statements. Such factors include, but are not limited to: (a) the decisions of the Pennsylvania Gaming Control Board regarding the issuance of gaming licenses in Philadelphia; (b) the risk that the proposed transaction to purchase the Sands/Traymore entities is not consummated; (c) many construction-related factors could prevent the Company from completing its construction and development projects within budget and on time; (d) because the Company has considerable leverage, future cash flows may not be sufficient to meet its financial obligations and the Company might have difficulty obtaining additional financing; (e) the risk that the proposed St. Louis and Sugarcane Bay projects, proposed expansions to the existing facilities, proposed acquisitions, and other capital intensive projects could strain the Company's financial resources and the risk that such projects and new developments might not provide for a sufficient return, if any; (f) the results of the damage from Hurricanes Katrina and Rita, and insurance proceeds available to the Company, including the impact to communities surrounding the Company's affected properties and issues that could arise with respect to our insurance policies that could reduce or significantly delay the receipt of insurance proceeds; and (g) other risks, including those as may be detailed from time to time in Pinnacle Entertainment's filings with the Securities and Exchange Commission ("SEC"). For more information on the potential factors that could affect the Company's financial results and business, review the Company's filings with the SEC, including its Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K.
FOR FURTHER INFORMATION:
For Pinnacle Entertainment (Investors):
Lewis Fanger - (702) 784-7777
For Pinnacle Entertainment (Media):
Cardenas Grant Communications
Barbara A. Grant - (215) 520-8849,
