Eldorado and Caesars assess merger
Both casino operators are exploring a merger that would see them turn into a major competitor in the casino industry.
US.- Eldorado Resorts and Caesars Entertainment are exploring a merger that would see them turn into a major competitor in the industry. The potential deal also follows the notoriety Carl Icahn gained in the latter company, as he also pushed the operator to sell itself.
Caesars has already given Eldorado some confidential financial information to let them carry out due diligence on the potential merger.
According to Roch Capital Partners analysts, “the universe of buyers (for Caesars) is limited, and Eldorado is best suited to extract full value from Caesars’ assets in (their) view.”
Caesars has just emerged from bankruptcy protection back in 2017 and operates 53 properties in 14 states. Eldorado, meanwhile, operates 26 properties in 12 states, which means that combined, they would be a major concern for other operators.
Caesars Entertainment recently revealed in a Securities and Exchange Commission filing that Carl Icahn has increased his previous 12.53% stake in the company stock to 17.75% and is now its largest shareholder.
The casino company had announced that Icahn had increased his previous 10% to 15.53%, but it once again updated the number just three days later. High River Limited Partnership, controlled by the billionaire, along with Icahn Partners LP and Icahn Partners Master Fund LP acquired 15 million shares at US$8.45 a share over the weekend and spent US$126.7 million.
Icahn will also have a major influence on the next CEO’s appointment, which may lead to a merger shortly. The 12-member board will see three executives step down (John Boushy, Matthew Ferko and Christopher Williams) to give way to Icahn Enterprises CEO Keith Cozza, Icahn Enterprises board member James Nelson and Icahn Capital fund manager Courtney Mather.
