Billionaire investor Carl Icahn is planning to push Caesars to consider a sale, the Wall Street Journal reports citing people familiar with matter
Reports about Mr. Icahn pressing for the company’s sale emerge after it became known that he was quietly building a stake in the Las Vegas gaming and hospitality powerhouse.
The New York activist investor currently owns 10% of Caesars. According to people familiar with the company’s shareholder dealings, Mr. Icahn believes Caesars has “desirable properties and that the outlook for Las Vegas is positive.” The WSJ report goes on that Mr. Icahn believes the casino and hotel operator would perform better under the stewardship of “a rival.”
It seems that the businessman is planning to press for Caesars to let its shareholders consider and decide on the options available and whether the company should be sold.
Mr. Icahn has not been the only shareholder to have pushed Caesars to consider divestment of assets or an outright sale. News emerged last September that New York hedge fund HG Vora had built a stake in the casino giant and pressed for sale of assets or some form of consolidation.
Caesars emerged from a complex and lengthy Chapter 11 bankruptcy in the fall of 2017. The company has been looking to pay down its behemoth debt which currently stands at around $9 billion and to improve its profitability in the competitive land-based casino and hospitality fields.
The gaming and hotel operator currently manages nearly 50 properties in 13 states and five countries, including Dubai where it launched two non-gambling resorts late last year. The company has said that part of its growth strategy would involve expanding its non-gambling portfolio.
Sale Offers
According to WSJ’s report, Caesars has been approached by at least two parties with purchase offers in recent months. One of the offers came from Golden Nugget’s owner, billionaire Tilman Fertitta. Sources have said that Mr. Fertitta has proposed that Caesars acquire his restaurant, gaming, and hospitality businesses in exchange for a majority stake. The businessman’s offer has also involved him running the combined entity. Caesars has rejected Mr. Fertitta’s bid.
It is believed that Eldorado Resorts Inc., another Nevada-based gaming and hospitality company, has too approached its much larger counterpart with a purchase offer, but discussions over a possible deal have fallen through.
It is to be seen whether Mr. Icahn’s push would result in a sale deal taking place. The New York billionaire investor is no stranger to the US land-based casino industry. Over the years, he purchased, operated, and sold casino properties in Las Vegas and Atlantic City. Most recently, he unloaded his holding in Tropicana Entertainment Inc. to Eldorado and real estate investment trust Gaming and Leisure Properties for $1.85 billion.
Mr. Icahn is also the former owner of Trump Taj Mahal which now operates as Hard Rock Hotel & Casino Atlantic City. Hard Rock International purchased the property from the billionaire investor in 2017 and invested more than $500 million into its transformation before swinging its doors open in June 2018.
Follow us on Facebook and Twitter to stay up to date on the day’s top casino news stories.
