The merger between Eldorado and Caesars is the biggest in the history of US casino companies. Obviously, a deal of this magnitude takes months to complete. Fortunately, this company merge is still taking place, despite the intense regulations around the country.
Hope is that this deal is able to take place before the end of the year. Today, we’re going to take a look at the details of this merger. We’ll also talk about some of the strategies these companies are taking to move their plans forward.
Let’s get into it!
Breaking Down the New Eldorado and Caesars Deal
Eldorado Resorts and Caesars Entertainment are two of the biggest casino companies in the world. Over the past decade, revenue at Caesars has slowed and company officials announced they were interested in making a change. This seemed to interest officials within Eldorado Resorts, who have been looking to expand.
In June of last year, news broke that Eldorado and Caesars had agreed to merge. Eldorado was paying an incredible $17 billion, making it the largest casino company sale in history. Under the terms of this agreement, Eldorado Resorts is taking control of all the Caesars properties.
These companies immediately began preparing for this merge. In July, Eldorado Resorts announced it was selling two of its major properties. This decision was made to help finance the larger acquisition of Caesars.
Over time, state gambling commissions began approving this new deal. In January, commissions in Louisiana, Pennsylvania, and Illinois all approved the merger between Eldorado and Caesars. The next month, New Jersey’s commission began taking a closer look at the details of this new deal.
Over the past six weeks, things have begun to change dramatically around the United States. The entire land-based casino industry in the country is shut down. Fortunately, the two companies involved in this massive merger are still taking steps to move the deal forward.
Here’s an Update on the Merger Between Eldorado and Caesars
Many states have now given the green light for this deal to go forward. Until it can be officially completed, though, several more government bodies need to give approval. Some felt this would be extremely difficult given the fact that the world is dealing with a global pandemic.
The current situation isn’t stopping company officials from scrapping their plans, though. This week, heads of Eldorado Resorts announced they were selling two major properties in order to help pay for the cost of the Caesars acquisition. The Eldorado Shreveport Resort in Louisiana and the MontBleu Resort Casino & Spa in Lake Tahoe are being sold to Twin River Worldwide Holdings for a combined $155 million.
Tom Reeg, CEO of Eldorado Resorts, commented on this deal to the media this week.
“The agreement to divest Shreveport and MontBleu to Twin River Worldwide Holdings is consistent with our continued focus on closing the Caesars transaction in the first half of 2020,” he said.
Caesars announced that it was selling its Bally’s Atlantic City property for $25 million. It’s not a huge surprise to see casinos in Atlantic City being sold. The SEC has voiced its concerns that the merger between Eldorado and Caesars would result in a monopoly-like situation in this city.
The sale of this property should put that idea to rest. It’s clear that these companies are focused on gaining government approval as fast as possible. Many analysts predict more of these small property sales over the next few months.
Las Vegas Mayor Wants the City to Reopen
The land-based gambling industry has been one of the worst-affected by this pandemic. All of the casinos around the United States are completely shut down. Even the top government officials cannot say when these gambling venues will be able to open again.
This has obviously had a devastating impact on the city of Las Vegas. Tourism here has completely stopped. Many casinos here are now losing millions of dollars every single day and some claim they cannot survive much longer under the current situation.
Las Vegas Mayor Carolyn Goodman is now demanding a change. She’s actively calling for businesses in the city to open back up. This goes directly against what most health experts in the country are advising.
It’s an extremely difficult time for this city. Las Vegas relies heavily on its tourism and gambling industries. Without these industries operating, the city is facing an extremely difficult economic situation.
Governor Sisolak is refusing to open the state back up. He wants to ensure that infection rates are dropping before major venues are able to open. Only time will tell how long this process takes.
The merger between Eldorado and Caesars is still carrying on. It now seems possible that this deal is completed before the end of the year.