Eldorado Resorts has agreed to acquire Caesars Entertainment
in a cash-and-stock deal worth approximately $17.3 billion, a
figure that includes the assumption of Caesars' debt.
The move will combine two of the largest players in the
gambling sector, bringing their reach to 60 domestic casinos and casino-resorts
across 16 states. Eldorado said the combined company will retain the Caesars
name, in an effort to "capitalize on the value of the iconic global brand
and its legacy of leadership in the global gaming industry."
Under the proposed transaction, Eldorado shareholders would
hold approximately 51% of the company, while Caesars shareholders would hold
the remaining 49%. The deal's $17.3 billion price tag includes $7.2 billion in
cash, as well as roughly 77 million Eldorado common shares and the assumption
of Caesars' outstanding net debt. In its first-quarter results, Caesars
reported long-term debt of about $8.8 billion.
The merged Caesars will be helmed by Eldorado's
executive leadership team, including chairman Gary Carano and CEO Tom Reeg. The
company will be headquartered in Reno, Nevada.
Concurrent with the takeover, Eldorado has entered into an
agreement to offload the real estate associated with Caesars Entertainment's
Harrah's Resort Atlantic City, Harrah's Laughlin Hotel & Casino and Harrah's
New Orleans Hotel & Casino to Vici Properties for approximately $1.8
billion. Vici is a real estate investment trust formed in 2017 as a spin-off
from Caesars Entertainment.
In a statement, Reeg said, "Together, [Eldorado and
Caesars] 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. The combined entity will serve
customers in essentially every major U.S. gaming market and will marry
best-of-breed practices from both entities to ensure high levels of customer
satisfaction and significant shareholder returns."
Reeg added that Eldorado also plans to leverage and
strengthen the Caesars Rewards loyalty program, which, when combined with
Eldorado's platform, will total more than 65 million rewards members
Eldorado currently owns and operates 26 properties in 12
states, including Colorado, Florida, Illinois, Indiana, Iowa, Louisiana,
Mississippi, Missouri, Nevada, New Jersey and Ohio, though the group is
markedly absent from Las Vegas.
Caesars owns and operates 34 casinos and resorts in
Kentucky, Illinois, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada and
New Jersey, with its resorts operating primarily under the Harrah's, Caesars
and Horseshoe brand names.
The company boasts a strong Las Vegas foothold via its
Caesars Palace, Harrah's Las Vegas, Paris Las Vegas, Planet Hollywood and Bally's
Las Vegas properties, among others. Earlier this year, Caesars unveiled plans for
a nongaming resort brand, Caesars Republic.