Eldorado to dump two casinos ahead of merger
The company is looking to get rid of lesser performing properties
Eldorado Resorts is cleaning house as it prepares to work on the massive acquisition of Caesars Resorts. As it looks to help find the funds necessary to cover the $17.3-billion price tag the purchase needs, it has begun to get rid of some of its properties. Two that have now been allocated for dismissal are the Lady Luck Casino in Vicksburg, MS and the Isle of Capri in Kansas City, MO.
Twin River Worldwide Holdings, which operates the only two casinos in Rhode Island – Twin River Lincoln and Twin River Tiverton – is going to spend $230 million to purchase the venues. The all-cash transaction still has to be approved by regulators and shareholders, and could be finalized early next year.
After it relinquishes the two properties, Eldorado will have a total of 26 in its portfolio. That will be increased by 30 when the Caesars acquisition is complete, so Eldorado doesn’t have to be too concerned with giving up two venues, especially if they weren’t performing at levels the company expected.
Industry analysts have weighed in on the sale, offering their support. According to John DeCree of Union Gaming, “The sale is relatively small compared to the ($17.3 billion) acquisition of Caesars, but it does help free up some balance sheet capacity to help finance the larger acquisition.”
David Katz with Jefferies added, “The intention here is to accomplish two things. One, to focus on areas that would overlap with Caesars, and two, to pursue transactions that would reduce the profile and leverage as much as they can prior to the deal closing.”