The transaction further expands the company’s geographic reach to 26 facilities in 12 states.
US.- Eldorado Resorts, Inc. has announced on Monday that it completed its previously announced acquisition of Tropicana Entertainment Inc. The transaction further increases the company’s scale, as it reaches 12 states with 26 facilities. Under the terms of the transaction, valued at approximately US$1.85 billion, a subsidiary of Eldorado merged into Tropicana and Tropicana became a wholly owned subsidiary of Eldorado.
The transaction is expected to be immediately accretive to Eldorado’s free cash flow and diluted earnings per share, inclusive of identified expected cost synergies of approximately US$40 million expected to be realised in Eldorado’s first year of operation of Tropicana. The combination creates a premier, diversified regional gaming platform with combined annual revenue of more than US$2.7 billion and combined adjusted EBITDA of approximately US$697 million.
Gary Carano, Chairman and Chief Executive Officer of Eldorado, said: “Our acquisition of Tropicana marks a continuation of Eldorado’s successful history of rapid growth through strategic, accretive acquisitions. Through this combination, we have significantly expanded the scale of our gaming operations, further diversified our geographic reach into new markets – some of which have already adopted sports wagering legislation – and minimised market-specific risk.
We continue to focus on enhancing shareholder value through strategic transactions, return-focused property enhancements and opportunistic partnerships with third parties – including the Tropicana transaction, the Grand Victoria acquisition and our recent agreements with The Cordish Companies and William Hill PLC.
Tom Reeg, President and Chief Financial Officer of Eldorado, added: “With the acquisition of seven Tropicana properties, Eldorado enters two new gaming jurisdictions and adds financial and geographic diversity to our operating base. We have identified US$40 million of synergies that we expect to realise over the next year. We believe the financing structure for the transaction, which includes a master lease of real estate acquired by GLPI, allows us to maintain financial flexibility for leverage reduction and continued transactional growth as we continue to own the majority of the underlying real estate across our remaining property portfolio.”