Home General News Eldorado Resorts Merging with Caesars in $18 Billion Deal

Eldorado Resorts Merging with Caesars in $18 Billion Deal

0
820
Eldorado Resorts Merging with Caesars in $18 Billion Deal
The merger deal worth around $18 billion will see Eldorado take over legendary Caesars

After many months of chatter, Eldorado Resorts finally decided to buy Caesars for around $18 billion in a stock deal as stated recently. This news about two major powerhouses merging arrives several months after it emerged on the scene that Eldorado Resorts and Caesars Entertainment have engaged in some kind of consolidation discussions. This deal values Caesars Entertainment at $13 per share as stated by reliable sources.

The same sources state that ownership of the merged facility would be split in half between the two powerhouses while the actual price is in line what Caesars Entertainment has expected from its potential buyer. Before this deal was finally sealed, several reports emerged on the scene stating that the biggest Las Vegas stakeholder, Carl Icahn who is a prominent New York businessman pressed Caesars Entertainment to finally finalize Eldorado Resorts merger talks.

It was also revealed that Carl Icahn as a member of the company’s board was at odds about the ultimate sale price. However, as reported, Mr. Icahn pressed the company’s board to offer an even lower price than that of $13 per share in order to finally finalize those merger talks. Despite his pressures, other members of the company’s board decided to stick with a higher price which will benefit all of the company’s stakeholders.

Merger Talks Began in March

As mentioned previously, the very first merger talks including Eldorado Resorts and Caesars Entertainment started at the beginning of March following Caesars Entertainment allowing Eldorado Resorts to access all of its financial information. Prior to these specific merger talks, Caesars Entertainment has been pressed to either merge with another company or to sell itself mainly by Mr. Icahn who is among the biggest company’s stakeholders with almost 29% of Caesars shares.

Icahn began building his Caesars stake at the beginning of this year and according to him and several other activist investors, a merger deal or a sale was the best way forward for the company that at the moment is struggling with a mountain of debt and needs to find new ways for cutting its increasing costs. When it comes to the merged Eldorado Resorts and Caesars Entertainment company, it is most likely to be split in half between the two operators.

The Combined Company with Tom Reeg as CEO

It was also reported earlier that the combined entity is most likely to see Tom Reeg who is the Eldorado Resorts’ CEO as the combined entity’s CEO as well. Both sides believe that Tom Reeg possess remarkable leadership skills and these skills are highly valued by Caesars Entertainment’s biggest stakeholder, Mr. Icahn. It also should be noted that last year, the hospitality and gaming operator bought Tropicana Entertainment from an activist investor for around $1.9 billion.

It also should be noted that Eldorado Resorts has an impressive market value of $4 billion while it operates twenty-six properties located in twelve states. Moreover, the company just recently get his permanent operating license for its recently purchased Tropicana Atlantic City. When it comes to Caesars Entertainment, the company’s business portfolio includes fifty-three both non-gaming and gaming resorts located in fourteen states and five more countries.

In the United States, Caesars Entertainment also operates several other brands including the Harrah’s and Horseshoe casinos. Hence, the combined facility would create a massive land-based gambling powerhouse with major ambitions to expand its business across other jurisdictions outside of the United States as well as cementing its reputation in its native country.

0 0 votes
Article Rating
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments