West Virginia Gaming News

Several Potential Buyers For Caesars Vegas Assets Could Emerge

As part of its $17.3 billion takeover offer, revealed last month, for Caesars Entertainment Corp.(NASDAQ:CZR), Eldorado Resorts, Inc. (NASDAQ:ERI) is expected to mull asset sales and that could include some of Las Vegas Strip properties operated by Caesars. There are likely to be plenty of willing buyers.

On a June 24 conference call discussing the Caesars deal, Eldorado CEO Thomas Reeg said the combined company could be “ be a seller of a Strip asset, but that decision has not been made.”

In an interview with the Las Vegas Review-Journal, SunTrust Robinson Humphrey analyst Barry Jonas said several gaming companies that currently lack Strip footprints could be potential buyers of a Caesars venue there.

The analyst highlighted regional players, such as Boyd Gaming Inc. (NYSE:BYD) and Penn National Gaming, Inc. (NASDAQ:PENN), as possible suitors for a Caesars strip casino while noting Monarch Casino & Resort, Inc. (NASDAQ:MCRI) and Rhode Island-based Twin River Worldwide Holdings, Inc. (NYSE:TRWH) could also be in the mix.

Due to the fact Strip casinos rarely come up for sale, there is likely to be fierce competition for any Caesars Sin City asset that Eldorado may decide to sell.

Speaking Of Competition

As Casino.org reported in the days following Eldorado’s announcement of a formal offer for Caesars, Treasure Island owner Phil Ruffin and Golden Nugget owner Tilman Fertitta remain interested in acquiring more Las Vegas properties and could be bidders for a Caesars casino if one comes up for sale.

Then there is VICI Properties Inc. (NYSE:VICI). On the day Eldorado unveiled its bid for Caesars, it said it is selling three Harrah’s casinos to VICI for $3.2 billion, but there are more relevant details.

Related to the deal to buy the three Harrah’s properties, VICI also gets rights of first refusal to buy or enter sale-leasback deals on two of Caesars’ Las Vegas casinos. If such a deal comes to pass, VICI would have its pick of the Flamingo Las Vegas, Bally’s Las Vegas, Paris Las Vegas and Planet Hollywood Resort & Casino.

If VICI consummates an initial transaction for one of those properties with Eldorado and decides to move forward with a second such buy, it would be able to choose from the remaining casinos in the aforementioned group and the LINQ Hotel & Casino.

Other Ideas

Prior to publicizing its offer for Caesars, Eldorado said it would sell two casinos in Missouri and one in West Virginia. Analysts have also discussed the possibility of the combined company selling gaming venues in other areas where they have geographic overlap, such as Louisiana and Reno/Tahoe. Like Eldorado, Monarch Casino is based in Reno and could look to scoop up another property there to shore up its share of its home market.

It is also possible that Eldorado could look to close some under-performing properties in select markets. Bally’s Atlantic City has been rumored to be a closure victim because Eldorado and Caesars currently own four of the casinos in the New Jersey gaming hub and regulators there might want to see that number lowered.

Source: www.casino.org