Penn National Gaming has agreed to acquire Illinois video gaming terminal (VGT) operator Prairie State Gaming (PSG) in an all-cash transaction.

PSG, also known as Illinois Gaming Investors LLC, operates more than 1,100 terminals at 270 bar and retail gaming establishments throughout Illinois.

In 2009, former Illinois Governor Pat Quinn signed a bill into law allowing video gaming terminals to be offered at any business holding a liquor license, which in the state equates to selling wine by the glass. Thousands of so-called “slot-cafes” have sprung up since then, taking a big bite out of casino revenues. Prairie State Gaming was one of the top five route operators in the state with $10m in EBITDA for the fiscal year that ended June 30.

Penn National Gaming CEO Jay Snowden said that purchasing PSG proved the company’s long-term strategy for growth through acquisitions.