The Florida Gaming Control Commission gave West Flagler Associates the green light to sell Magic City Casino to PCI Gaming Authority. The deal could be the largest in Florida casino history.
The FGCC gave both sides 30 days to close the deal. The sale includes pari-mutuel, card room and slot machine licenses for the current fiscal year.
The two parties did not disclose the sale price. However, industry experts are valuing the cash deal to be around $600 million.
Poarch Band of Creek Indians to pick up third Florida property
The Poarch Band of Creek Indians from Alabama owns PCI Gaming. Magic City would be the third Florida property in their portfolio, joining pari-mutuel facilities in Pensacola and Gretna.
West Flagler Associates is an infamous company in the Florida gaming industry. They are run by the Havenick family and are the plaintiffs in the Florida sports betting lawsuit involving the Seminole Tribe and the Department of the Interior. The suit stems from the 2021 Florida gaming compact that briefly legalized sports betting in Florida.
Gov. Ron DeSantis and the Seminole Tribe agreed to the deal in May 2021. But West Flagler filed suit over the ‘hub-and-spoke’ model used to allow sports betting. In November 2021, a federal judge agreed with West Flagler. Thus, Judge Dabney Friedrich invalidated the compact.
The tribe and the federal government appealed the case to the D.C. Court of Appeals and are awaiting a decision. But the sale will not have any bearing on the case’s outcome.
Attorney John Lockwood represents both parties and confirmed this will be a cash deal. But the Alabama natives are no strangers to large deals. In 2019, they purchased Sands Casino Resort in Pennsylvania for around $1.3 billion.
Even though casino is in the title, Magic City Casino is technically a pari-mutuel facility. Florida law states tribal lands are the only place casinos can be located. As a result, two Florida tribes own all seven casinos.
The Seminole Tribe owns and operates Florida’s six Class III casinos. The Miccosukee Tribe operates the seventh, a Class II facility in the Miami area.
Licensing Gretna Racing helps commission approve deal
There was a two-month hold on the sale mostly due to the sides redacting 103 pages of the 110-page original proposal. The FGCC wanted more transparency before allowing the deal to proceed.
The Seminoles also raised concerns over whether the deal was above-board. Specifically, the tribe questioned the legality of transferring slot and pari-mutuel licenses between parties. According to the commission’s meeting agenda from Feb. 8, “The proposed acquisition does not include the ‘transfer’ of the licenses. A slot machine gaming license is being sold, thereby causing a change of ownership of the license. Such a change of ownership is expressly permitted.”
Once PCI resubmitted the proposal, the subsidiary was switched from Wind Creek Miami, LLC to Gretna Racing.
PCI owns Gretna Racing, a licensed pari-mutuel facility 30 miles northwest of Tallahassee. Consequently, the Commission didn’t have to worry about the legalities of transferring licenses. PCI responded to the concerns by confirming the sale would be in cash and that the company would borrow money for future capital improvements.
Now that the commission has approved the sale, the only thing that stands between the deal’s completion is paperwork and payment, said Ross Marshman, general counsel for the commission.
“If it happens as described, it can be approved. But we have to actually see evidence that what was described actually took place.”