In a surprise move, regional American casino operator, Eldorado Resorts Incorporated, has reportedly announced that it has inked an agreement that is to see it spend upwards of $8.58 billion in order to acquire a majority stake in larger rival Caesars Entertainment Corporation.
According to a report from, The Wall Street Journal, the successful completion of the cash and stock deal is due to create the largest casino firm in the United States while also giving Reno-headquartered, Eldorado Resorts Incorporated, a presence in five overseas jurisdictions encompassing Dubai, South Africa, Egypt, Canada and the United Kingdom.
The arrangement will involve Eldorado Resorts Incorporated acquiring all of the outstanding stock in Caesars Entertainment Corporation to give it a 51% shareholding before merging its own operations with those of its latest acquisition. The newly-enlarged entity is to purportedly retain the Caesars name and be responsible for running gaming operations inside 76 properties including the giant Rio All-Suite Hotel and Casino Las Vegas, Harrah’s Resort Southern California and Caesars Atlantic City Hotel and Casino.
As a part of the transaction, The Wall Street Journal reported that Eldorado is to moreover assume responsibility for approximately $8.8 billion in Caesars Entertainment Corporation debt and sell off its interests in a trio of properties covering Harrah’s New Orleans Hotel and Casino, Harrah’s Resort Atlantic City and Harrah’s Laughlin Hotel and Casino to Vici Properties Incorporated. The firm detailed that this latter stipulation is due to see it bring in around $3.2 billion that it intends to put towards funding the larger acquisition.
Additionally, Eldorado is worth about $4 billion but holds debts of around $3 billion while Caesars’ market value stands at just over $6.7 billion. The newly-combined entity is to be run by an eleven-member board of directors consisting of five representatives from the Las Vegas-based target alongside six from its new parent.
Rumors that Caesars Entertainment was up for sale began in March shortly after American hedge fund billionaire Carl Icahn (pictured) became the land-based casino giant’s largest shareholder. The 83-year-old businessman now holds a 15.5% stake and had been leading efforts to revitalize a business that had seen the value of its shares decline by around 30% over the course of the past year.
For its part, Eldorado is already responsible for 26 casinos in twelve states including the Tropicana Casino and Resort Atlantic City and the Eldorado Resort Casino Reno while the firm’s Chief Executive Officer, Tom Reeg, used an official press release to describe the transaction as ‘a strategically, financially and operationally compelling opportunity’ that is set to bring ‘immediate and long-term value to stakeholders of both companies.’
Reeg’s statement read…
“Together, we will have an extremely powerful suite of iconic gaming and entertainment brands as well as valuable strategic alliances with industry leaders in sportsbetting and online gaming. The combined entity will serve customers in essentially every major United States gaming market and will marry best-of-breed practices from both entities to ensure high levels of customer satisfaction and significant shareholder returns.”