Local News


Eldorado buying Caesars in $17.3B cash-and-stock deal

Posted at 5:24 AM, Jun 24, 2019
and last updated 2019-06-25 01:59:59-04

LAS VEGAS (AP) — Eldorado Resorts is buying Caesars in a cash-and-stock deal valued at $17.3 billion, creating a casino giant.

The deal Monday puts about 60 casinos and resorts in 16 states under a single name.

Financial analyst Steve Budin says there's one possible drawback.

"The company is looking to achieve over 500 million dollars of savings. Usually the quickest ways to get savings is through layoffs... usually the first round of layoffs comes from middle and upper level management because they are highly compensated and they have jobs that are highly duplicating."

The solution for middle and upper level managers may be to move out of state.

"The challenge will be to find another position in Las Vegas, but the benefit of this company coming in is they have properties in multiple states. If somebody is willing to relocate, there could be some job opportunities in Iowa, Colorado, Missouri, Louisiana."

If you're a local who plays and visits the properties, the competition is great.

"You're going to have a big player come in and they're going to have some perks. My guess would be once they merge your player cardholder for either property you will be able to use it for 60 properties," says Budin.

At the same time, money made from gambling has been on the decline especially on the Las Vegas strip. UNLV gaming historian David Schwartz says new management could bring in a fresh approach.

"Right now the merger is not going to have an impact on the day to day goings on. When it does close next year we could see some strategies that might help increase that revenue," says Schwartz.

Eldorado will pay $8.40 per share in cash and 0.0899 shares of Eldorado stock for each Caesars share, or $12.75 per share.

The combined business will be called Caesars and its shares will be traded on the Nasdaq stock market.

Shareholders of Eldorado Resorts Inc. will hold about 51% of the company's outstanding stock, with Caesars Entertainment Inc. shareholders holding the remaining and 49%.

The deal is targeted to close in the first half of next year if approved by gaming regulators and shareholders.