New York-listed casino operator Eldorado Resorts has entered into a definitive merger agreement with rival Caesars Entertainment Corporation in a $17.3bn cash and stock deal which brings together two of the largest casino operators in the US.

The proposed transaction will see the enlarged company operate 60 domestic casino resorts and gaming facilities across 16 states.

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.

This brings the total consideration to around $17.3bn, comprised of $7.2bn in cash and 77m Eldorado common shares, as well as the assumption of Caesars outstanding net debt.

“Eldorado’s combination with Caesars will create the largest owner and operator of US gaming assets and is a strategically, financially and operationally compelling opportunity that brings immediate and long-term value to stakeholders of both companies,” said Eldorado Resorts CEO Tom Reeg.

“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. The combined entity will serve customers in essentially every major US gaming market and will marry best-of-breed practices from both entities to ensure high levels of customer satisfaction and significant shareholder returns.”

Upon completion of the deal, the combined company will retain the Caesars name and will continue to trade on the Nasdaq Global Select Market. Eldorado and Caesars shareholders will hold approximately 51 per cent and 49 per cent of the combined company's outstanding shares respectively.

The new Caesars will be headquartered in Reno, retaining a significant corporate presence in Las Vegas, and will be lead by Eldorado chairman Gary Carano and CEO Tom Reeg. Its board of directors will consist of 11 members, six of whom will come from Eldorado’s board and five from Caesars’ board.

“This announcement is the culmination of a thorough evaluation by the Caesars board of directors,” said Caesars chairman Jim Hunt. “The board unanimously concluded that the combination of these two companies creating an even stronger entity is a decision for our shareholders’ consideration and vote for immediate and ongoing value.”

Caesars CEO Tony Rodio added: “We believe this combination will build on the accomplishments and best-in-class operating practices of both companies. I’m familiar with Eldorado and its management team, having worked with them on a previous transaction, and I look forward to collaborating with them to bring our companies together.

“We are excited to integrate Caesars Rewards with the combined portfolio. The incorporation of Caesars Rewards has produced strong results at the recently acquired Centaur properties. By joining forces, we believe the new Caesars will be well-positioned to compete in our dynamic industry.”

As part of the deal, Eldorado has also entered into a $3.2bn master transaction agreement with VICI Properties, part of which will see VICI acquire the real estate associated with Harrah’s Resort Atlantic City, Harrah’s Laughlin Hotel & Casino, and Harrah’s New Orleans Hotel & Casino for $1.8bn.

Shares in Caesars Entertainment Corporation (NSQ:CZR) closed at $9.99 per share in New York Friday, while shares in Eldorado Resorts Inc (NSQ:ERI) closed at $51.22 per share.

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