PNG backs out from tribal operation

Penn National Gaming has ceased to manage a Californian tribe’s casino after the latter failed to honor financial commitments.

US.- Casino operator Penn National Gaming (PNG) has informed the US Securities and Exchange Commission (SEC) that it would cease to manage the Hollywood Casino Jamul-San Diego through its subsidiary San Diego Gaming Ventures (SDVG). The decision, which also involves halting the provision of branding and development services to the property, comes after the Jamul Village of California tribe failed to honour its financial commitments.

Jamul Indian Village Development (JIVDC), the company founded by the tribe, was given a first US$98 million loan from SDVG and further funding commitments of US$29 million. Nonetheless, PNG reported that the tribe didn’t repay the loans, causing the company to take a US$48.5 million impairment charge.

The Jamul deal will be terminated by May 28th and, according to PNG, it will book additional charges of US$29.4 million on its 2017 results.

After PNG’s decision, the Jamul tribe said that it will change the venue’s name to Jamul Casino and, according to JIVDC chair Erica Pinto, it “represents an important step toward [their] long-held goal to manage our own casino.”