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Home / Business / Eldorado Said to Agree to Buy Caesar's for About $ 8.7 Billion

Eldorado Said to Agree to Buy Caesar's for About $ 8.7 Billion



(Bloomberg) – Eldorado Resorts Inc. agreed to buy Caesars Entertainment Corp. for about $ 8.7 billion in cash and stock, according to a person familiar with the situation.

The deal values ​​Caesars at about $ 13 a share. Including assumed Caesar's debt, the transaction would be valued at about $ 18 billion.

The price represents a 30% premium to Caesar's close on Friday. Eldorado had a market value of about $ 4 billion as of Friday.

Caesars had been pushed up by Activist billionaire Carl Icahn, his biggest shareholder in Bloomberg, to consider a sale.

Eldorado shares have risen 17% in the past year, compared with a 12% decline in Caesars' stock , The S & P Supercomposite Casinos & Gaming Index, which slumped about 20%.

Caesars shares are trading at 24 times earnings, while Eldorado is valued at 33 times, according to data compiled by Bloomberg.

Officials from Eldorado and Caesar declined to comment on the report. Reuters earlier reported the acquisition plan.

Eldorado was not Caesars' only suitor. Golden Nugget owner Tilman Fertitta proposed merging his restaurant and casino empire with Caesar's last year, but was rejected by Caesars.

Caesars, whose properties include the flagship Caesars Palace and the Harrah's chain, is still coping with the fallout of a 2008 leveraged buyout led by Apollo Global Management LLC and TPG that left it with a mountain of debt. The company completed a bankruptcy of its largest unit two years ago that brought in new board members and shareholders, including distressed-debt investors. Apollo and TPG have their shares.

Eldorado, which dates back to a single casino opened in Reno, Nevada, in 1973, has grown exponentially in recent years under the direction of Tom Reeg, who is now chief executive officer. The company has been acquired by Tropicana Entertainment Inc., which was controlled by Icahn.

The business, which still numbers the founding Carano family as its largest shareholder, now has 26 casinos in 12 states.

– With assistance from Hailey Waller.

To contact the reporters on this story: Scott Deveau at New York at sdeveau2 @ bloomberg.net Christopher Palmeri Los Angeles at cpalmeri1@bloomberg.net Liana Baker New York at lbaker75@bloomberg.net

Nick Turner at nturner7@bloomberg.net,; Liana Baker at lbaker75@bloomberg.net, Linus Chua, Steve Geimann

© 2019 Bloomberg LP


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