Reno’s Eldorado Resorts to buy Caesars in $17.3 billion casino merger |

Reno’s Eldorado Resorts to buy Caesars in $17.3 billion casino merger

NNBV staff and wire reports
Eldorado Resorts' three main properties in Reno — Eldorado, Silver Legacy and Circus Circus — are seen in this night shot.
Courtesy Eldorado Resorts

RENO, Nev. — Eldorado Resorts is buying Caesars Entertainment in a cash-and-stock deal valued at $17.3 billion, effectively creating the largest owner and operator of gambling assets in America.

The acquisition — reported Sunday as a merger by various media and confirmed Monday by both companies in a joint press release — puts about 60 casinos and resorts in 16 states under a single name.

The combined company will retain the Caesars name “to capitalize on the value of the iconic global brand and its legacy of leadership in the global gaming industry,” according to the announcement Monday; the new company will continue to trade on the Nasdaq Global Select Market.

“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,” Eldorado CEO Tom Reeg said in a Monday statement.

The company will be led by Reeg, along with Eldorado Chairman Gary Carano. It will be based in Reno, where Eldorado is based, with a “significant corporate presence” in Las Vegas, where Caesars is based.

Eldorado Resorts Chairman and CEO Gary Carano oversaw the corporation’s expansion from seven to 20 properties in 2017.
Photo: Kaleb M. Roedel

According to the release, Eldorado will acquire all of the outstanding shares of Caesars for a total value of $12.75 per share, consisting of $8.40 per share in cash consideration and 0.0899 shares of Eldorado common stock for each Caesars share of common stock based on Eldorado’s 30-calendar day volume weighted average price per share as of May 23, 2019.

This reflects a total consideration of roughly $17.3 billion, composed of $7.2 billion in cash, approximately 77 million Eldorado common shares and the assumption of Caesars outstanding net debt (excluding face value of the existing convertible note).

In simpler terms, the transaction values Caesars at about $8.6 billion, and Eldorado will pick up about $8.8 billion of the casino’s debt.

Eldorado and Caesars shareholders will hold approximately 51% and 49% of the combined company’s outstanding shares, respectively.

Locally, Caesars owns the Harrah’s casino in Reno, as well as Harrah’s and Harvey’s in Stateline, on Lake Tahoe’s South Shore. Also from a local standpoint, Eldorado Resorts owns the Eldorado, Silver Legacy and Circus Circus casinos in Reno, in addition to the Montbleu resort in Stateline, which Eldorado purchased in 2018.

Pictured are the four larger casinos in Stateline, on Lake Tahoe’s South Shore. Monday’s news means the Hard Rock Hotel and Casino would be the lone “Big Four” properties owned by a different company.
Photo: Ryan Hoffman

Eldorado said Monday that it’s also reached a real estate agreement with VICI Properties Inc. in which VICI will acquire the real estate associated with Harrah’s Resort Atlantic City, Harrah’s Laughlin Hotel & Casino, and Harrah’s New Orleans Hotel & Casino for approximately $1.8 billion.

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.

The Eldorado-Caesars deal is targeted to close in the first half of next year if approved by gaming regulators and shareholders.

Caesars’ stock jumped 12.2% before the market open, while shares of Eldorado fell 6.6%.