Caesars Palace is one of 43 properties owned by Caesars Entertainment Corporation. The following ownership information is a subset of that available in the Gaming Business Directory published by Casino City Press. For more information about Gaming Business Directory products visit www.CasinoCityPress.com. Caesars Entertainment Corporation (Owner). FILE - In this Jan. 12, 2015, file photo, a man takes pictures of Caesars Palace hotel and casino, in Las Vegas. Eldorado Resorts will buy Caesars in a cash-and-stock deal valued at $17.3 billion, creating a casino giant.
A casino juggernaut was formed Monday when Eldorado Resorts announced it is buying Caesars in a cash-and-stock deal valued at $17.3 billion.
The acquisition will put about 60 casino-resorts in 16 states under a single name, Caesars, creating the largest gambling operator in the United States. The deal — following pressure from activist investor Carl Icahn — is targeted to close in the first half of 2020 if approved by gambling regulators and shareholders.
It would open the doors of the Las Vegas Strip market to Eldorado.
Caesars Palace Las Vegas
“We are incredibly excited. This is an iconic brand,” Eldorado CEO Tom Reeg said referring to Caesars Entertainment during a conference call. “It’s really a level of property and brand that we have not had the great fortune to control and now we will.”
Eldorado will pay $8.40 per share in cash and 0.0899 shares of Eldorado stock for each Caesars share, or $12.75 per share. The transaction values Caesars at about $8.6 billion, and Eldorado will pick up about $8.8 billion of the casino’s debt.
Shareholders of Eldorado Resorts Inc. will hold about 51% of the company’s outstanding stock, with Caesars Entertainment shareholders holding the remaining and 49%.
The company will be led by Reeg, along with Eldorado Chairman Gary Carano. It will be headquartered in Reno, Nevada, where Eldorado is based, and have a significant corporate presence in Las Vegas, where Caesars is based.
The deal was months in the making. Icahn earlier this year revealed he had amassed an enormous stake in Caesars Entertainment and pushed for fundamental changes at the company, including board representation and a say in the replacement of the then-CEO. He argued that the company’s stock was undervalued and the best way to boost it would be to sell the company.
Caesars Entertainment Corp., which operates more than 30 casinos in the U.S., emerged from bankruptcy protection in late 2017, but it’s been struggling since.
Icahn in April appointed Caesars Entertainment’s current CEO, Tony Rodio, who had the same role at the billionaire’s Tropicana Entertainment, which was sold to Eldorado in 2018. He also got to pick board members.
“While I criticized the Caesars Board when I took a major position several months ago, I would now like to do something that I rarely do, which is to praise a board of directors for acting responsibly and decisively in negotiating and approving this transformational transaction,” Icahn said in a prepared statement Monday. “As a combined company, Caesars and Eldorado will be America’s preeminent gaming company.”
The bankruptcy reorganization led to the creation of the real estate investment trust VICI Properties Inc. It owns the buildings and land of more than 20 casino-resorts, including Caesars Palace on the Las Vegas Strip, and leases the operations back to casino operators.
Eldorado said Monday that it also reached an agreement with VICI Properties Inc. in which VICI will acquire the real estate associated with Harrah’s Resort Atlantic City, Harrah’s Laughlin Hotel and Casino located about 100 miles (161 km) south of Las Vegas, and Harrah’s New Orleans Hotel and Casino for approximately $1.8 billion.
Caesars operates three casinos in Atlantic City and Eldorado operates one. 50 lions casino game.
Other terms of the deal include VICI being given right of first refusals for whole asset sale or sale-leaseback transactions on two Las Vegas Strip properties and the Horseshoe Casino Baltimore.
Reeg told analysts and investors the company expects to sell some properties that may allow it to avoid federal anti-trust issues. It is also evaluating whether to sell properties on the Strip.
“As I sit here today, I tell you, I think that there’s more Strip exposure than we would need to accomplish our goals with our regional database,” he said. “So, I would expect that we would be a seller of a Strip asset, but that decision has not been made.”
It is uncertain whether the new company will venture into Japan, where major casino operators have set their sights after the nation legalized casino gambling last year. Reeg said “no firm decisions” have been made on the international market, but the opportunity would have to be “stupendous for us to be running in that direction.”
Caesars’ stock jumped 16% Monday, while shares of Eldorado fell 10%.
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Martin Harris
Following months of speculation about a number of different scenarios involving Caesars Entertainment Corp., a major deal was finally announced Monday morning. As reported by multiple outlets, casino operator Eldorado Resorts Inc. has agreed to acquire and merge with Caesars Entertainment in a cash-and-stock deal worth $17.3 billion that also includes Eldorado assuming Caesars' not insignificant debt.
The joining of the two operators creates the United States' largest gaming company. Going forward, the newly-merged company will be known as Caesars and will be headquartered in Reno where Eldorado is based.
At the end of March, Caesars was operating 53 properties in 14 states as well as in five other countries, according to The New York Times. It was less than two years ago that the largest operating unit of Caesars Entertainment Corp managed to emerge from bankruptcy following a complicated restructuring of the company. At the end of March Caesars' long-term debt (now taken on by Eldorado) stood at $8.79B.
Carl Icahn: 'It is rare that you see a merger where because of the great synergies 'one plus one equals five.'
Meanwhile Eldorado Resorts, with a current market value of $4 billion and a long-term debt of just over $3 billion (as of the end of March), currently owns 26 properties in 12 different states (though none in Las Vegas).
![Owner Owner](https://turnthere.files.wordpress.com/2013/04/lasvegas2013-69.jpeg?w=625&h=416)
Eldorado shareholders will hold 51 percent of the new company's outstanding shares, with Caesars shareholders holding 49 percent.
News that a merger between Eldorado and Caesars might be forthcoming first emerged back in the spring with reports that Caesars' board had approved a possible sale, with initial rumors citing either Eldorado or the Golden Nugget as a potential buyer and/or partner.
Such stories occasionally overlapped as well with speculation about the future location of the World Series of Poker, presently playing out for the 15th year at the Caesars-owned Rio All-Suite Hotel and Casino.
Billionaire mogul Carl Icahn expressed his pleasure with the deal. 'It is rare that you see a merger where because of the great synergies 'one plus one equals five,' said Icahn, the NYT reports. 'I look forward to seeing our investment prosper.'
Icahn's comments aren't surprising, given his current influence within Caesars and his previously known position favoring such a deal. By the end of the first quarter of this year, Icahn had reportedly built up at least a 15 percent stake in the company, perhaps as much as 18 percent. In late February of this year, it was Icahn who proposedAnthony Rodio to succeed Mark Frissora as Caesars's CEO. Then in March Icahn made a deal with the company allowing him to appoint three members to the Board.
'We believe this combination will build on the accomplishments and best-in-class operating practices of both companies,' said Rodio in the companies' announcement of the deal. 'By joining forces, we believe the new Caesars will be well-positioned to compete in our dynamic industry.'
Eldorado CEO Tom Reeg: 'Together, we will have an extremely powerful suite of iconic gaming and entertainment brands.'
Eldorado CEO Tom Reeg similarly expressed optimism regarding the newly-combined company's future.
Caesars Palace Owners
'Eldorado's combination with Caesars will create the largest owner and operator of U.S. gaming assets and is a strategically, financially and operationally compelling opportunity that brings immediate and long-term value to stakeholders of both companies,' said Reeg.
'Together, we will have an extremely powerful suite of iconic gaming and entertainment brands, as well as valuable strategic alliances with industry leaders in sports betting and online gaming,' Reeg added.
Photo: 'Caesars Palace Las Vegas,' Bernard Spragg, public domain.
Caesars Palace Ownership History
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