Eldorado Resorts has agreed to purchase its much-larger rival, Caesars Entertainment.
The overall cash-and-stock deal is valued at $17.3 billion. The acquisition includes Caesars’ debt.
Eldorado will acquire all of Caesars’ outstanding shares for $12.75 each, a 29% premium over its closing price last Friday. The buyout consists of $8.40 a share in cash consideration, as well as 0.0899 shares of Eldorado common stock for each of its rival’s share of common stock.
Exactly what this means for a roost of high-profile musical residencies is unclear at this stage. Celine Dion, Elton John, Rod Stewart, Cher, Bette Midler, Shania Twain, and Mariah Carey are just some of the artists who have reaped significant profits off of Caesars stints. In all likelihood, cash machines like Celine Dion will continue to play at the Caesars Palace and other Caesars Entertainment properties.
The acquisition combines Caesars’ Las Vegas properties, including Caesars Palace and Harrah’s, with Eldorado locations.
The combined company – simply dubbed Caesars – will now own and operate 60 casinos in 16 states. Both Eldorado and Caesars shareholders will hold 51% and 49% of the combined company’s shares, respectively.
Speaking about the deal, Tom Reeg, Eldorado’s CEO, explained,
“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.”
He added Caesars will have an “extremely powerful suite” of gaming and entertainment brands. The company will also have valuable existing strategic alliances with industry leaders in sports betting and online gaming.
Reeg and Gary Carano, Chairman of Eldorado, will lead the new company. Based in Reno, Nevada, the new firm will have a “significant corporate presence.”
The move comes several months after billionaire investor Carl Icahn pushed for a sale of the company. He revealed his ownership of 18% of Caesars Entertainment. In early March, Icahn gained three board seats and supported Anthony Rodio’s appointment as CEO. The company had recently emerged from bankruptcy protection but continues to struggle.
Present-day financial issues aside, the history remains rich. Other artists who have performed at Caesars Palace include Frank Sinatra, Sammy Davis, Jr., Diana Ross, Tom Jones, and Willie Nelson, among many others.
Featured image by GFDL (CC by 2.0).