Penn Interactive Ventures (PIV) is making room for more shelves in its online casino library.
Last week, the digital subsidiary of Penn National Gaming (PNG) announced a long-term partnership with slots developer Lightning Box. The deal will bring new titles to PNG’s portfolio of online casinos starting this year.
Although the games will initially be limited to social casino platforms, both parties have clear ambitions in the real-money space.
PNG has been pressing especially hard in recent years, locking up major deals across both land-based and digital properties. This one represents a small but relevant piece of a much-larger expansion.
Sydney-based Lightning Box is establishing a presence on American soil itself, counting Penn among a growing list of partners.
Penn Interactive + Lightning Box
Under the deal, some of Lightning Box’s titles will be available within Penn’s online casino library this year. The popular Chilli Gold will be the first to go live in Q3, followed by Dolphin Gold, Respin Rhinos, Silver Lion and others from the company’s 50-title library.
The games will launch on PIV’s three social clients:
- Hollywood Casino
- Big Bonus Slots
- Viva Slots
These are free-to-play products, but this deal also turns an eye toward a paid platform down the road. Lightning Box has experience in both spaces, including a real-money position in the young New Jersey market.
PIV Managing Director Chris Sheffield highlighted as much in his statements:
“Lightning Box’s gaming content is proven across real-money and social gaming platforms. And with its already established U.S. credentials, we look forward to working together for the foreseeable future.”
Penn putting pieces into place
Land-based expansion comes first…
PNG has spent about 20 years acquiring property around the country, starting with a few more race tracks within the region. It branched out geographically and conceptually in 2000, entering the casino business with standalone properties in St. Louis and Biloxi.
The group acquired the Hollywood brand in 2003, then Argosy Gaming two years later. It was buying so much property that it formed its own real-estate entity for tax purposes, Gaming and Leisure Properties, Inc. There were even rumors that PNG was maneuvering for a Harrah’s buyout at one point.
Penn has owned Hollywood Casino at Penn National Race Course since the beginning, too. With PA horse racing running through its veins, PNG recently fortified its position in its home state.
Late last year, it announced plans to purchase Pinnacle Entertainment in a landmark deal worth $2.8 billion. The closing will add another dozen properties to PNG’s portfolio, including Meadows Racetrack and Casino near Pittsburgh. It also scooped up two PA satellite casino licenses at auction, with plans for those licenses pending.
By the time the transactions settle out, the group will own or operate more than 40 properties in 20 jurisdictions.
Online gaming has come into PNG’s sights during recent years, too. As the first states started to legalize the industry, PNG began assembling the pieces for its own product.
It formed the Interactive Division around the start of 2015, pulling a former UK gaming executive to lead the endeavor. Penn said that Sheffield would be “responsible for setting the Company’s strategy as it prepares for the launch of online gaming initiatives across its portfolio.”
Social gaming came quickly.
PNG immediately entered into a partnership with Scientific Games, one of the leaders in online casino technology. Its free Play4Fun platform is widely used across the industry, both in the US and abroad. Sheffield and his team had two social casinos up and running the same year, both under Hollywood branding.
A year later, PNG added mobile capabilities. It acquired Rocket Games for $60 million, unveiling its first mobile product within weeks.
Then real-money online gambling?
Real-money online gambling seems to be next, and PNG has a strong headquarters on home turf.
The Keystone State is both the most recent to pass enabling legislation and the largest to do so. Regulators have just begun reviewing license applications, and the industry should roll out in the coming months.
PNG will be well-positioned to participate when launch day arrives. During the Pinnacle acquisition, the group was forthcoming about its long-term plans:
The acquisition will leverage Penn National’s portfolio of regional and destination gaming properties and social gaming platforms across Pinnacle’s portfolio of complementary assets. The combined company will benefit from additional promotional opportunities in online and social gaming, which will help provide an additional boost to property level performance.
As other markets have shown, online gaming is an effective tool for customer retention and cross-promotion. This is especially true for large groups with sprawling portfolios, which can leverage their databases and services across multiple markets.
After taking up a second position in PA, it’d be no surprise to see PNG enter the real-money online space in the near future. How exactly those plans come together, though, remains to be seen.
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