Caesars Entertainment Corp. and Eldorado Resorts secured on Friday regulatory approval from the Indiana Gaming Commission to complete their $17.3 billion casino merger, but with certain conditions.
The combined casino group, which will operate and trade as Caesars Entertainment Inc., will have to sell at least two properties in Indiana to address the state gambling regulator’s concerns over market concentration.
As projected by the Gaming Commission, the enlarged Caesars group will control between 50% and 60% of gaming revenues generated in the state. By selling at least two of its properties in Indiana, that would fall to at or below 40%.
Eldorado’s CEO, Tom Reeg, who will step in as chief of the combined group, said Friday that it would have market concentration of around 40% if it sells two of its casinos in the state and that the properties it would divest would likely be Caesars Southern Indiana in Elizabeth and Tropicana in Evansville.
Some members of the Indiana Gaming Commission pushed for the sale of a third Caesars property and Mr. Reeg said that Horseshoe Hammond would likely be that third property. The executive asked the regulator for some time to complete the sale of casinos.
The combined casino company has until December 31 to secure definitive agreements for the divestiture of properties.
Employment Level Conditions
The enlarged Caesars will also be required to maintain certain employment levels some time after the tie-up between Eldorado and the original Caesars closes. The company is yet to work out metrics with the Indiana Gaming Commission.
Commenting on this, Mr. Reeg said Friday that they are “open to any employment conditions that you would impose upon the combined company.” The executive went on to say that they do not plan “significant cuts” in their Indiana assets and that post-Covid a lot of things will be impacted by what operations they will be allowed to bring back, but “Indiana job cuts are not a material percentage of any savings that we see going forward.”
The Indiana Gaming Commission was the penultimate regulator Caesars and Eldorado needed approval from in order to be able to close their merger. New Jersey regulators have remained the final regulatory hurdle before the mega-deal after the much-anticipated green light from the Federal Trade Commission came late last month and Nevada regulators approved unanimously the transaction earlier this month.
The New Jersey Casino Control Commission will hold its next meeting July 15. The Caesars-Eldorado merger is part of the regulator’s agenda for that day.
In Indiana, the enlarged Caesars will focus on growing revenue at those of its properties that have reopened to the public, improving horse racing in Nevada, and supporting the expansion of table games at Hoosier Park and Indiana Grand, Mr. Reeg told state regulators on Friday.
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