I t’s been expected for weeks and even months.
Eldorado Caesars Agree to $17.3 Billion Merger It’s finally happened.
Eldorado Resorts and Caesars Entertainment have shaken hands on a merger of their.
Two companies in a $17.3 billion cash-and-stock deal that will create the world’s largest casino operator.
Corporate raider Carl Icahn, who has amassed a controlling 28 percent stake in Caesars over the last several months, professed himself “pleased.”
Icahn, the main catalyst for the deal, had been pushing hard for a sale of the Las Vegas-based gaming giant,
Which had shed some $10 billion in debt through a reorganization in U.S.
Bankruptcy Court of its largest operating company two years ago, but was unable to generate much lift under a share.
Price that’s lagged below $10 ever since, despite an enormous portfolio of 53 properties in 14 U.S. states and five other countries.
Once Icahn swooped in, eventually claiming three seats on the board of directors, a sale was all but assured.
“This merger is the quintessential example of how an activist shareholder, working collaboratively with the board, can enhance value for all stockholders,”
he said in a prepared statement accompanying the announcement of the merger last month.
“The deal price represents a premium of 51 percent over Caesars’
Trading price on the day before our representatives joined the Caesars board on March 1, 2019.”
Needless to say, that’s a huge profit for Icahn and a win overall for Caesars shareholders.
Eldorado was a relatively obscure Northern Nevada operator that went on a buying spree.
Five years ago and transformed itself into a major player in the U.S. regional market with 26 casinos in 12 states.
It will acquire all of Caesars’ outstanding shares for $8.40 in cash each, and 0.0899 shares of Eldorado.
Stock based on Eldorado’s 30-calendar day volume-weighted average price per share as of May 23.
Based on that formula, the deal values Caesars’ equity at $8.54 billion, or $12.75 per share,
Eldorado Caesars Agree to $17.3 Billion Merger and is worth in total approximately $17.3 billion, comprised of $7.2 billion in cash, approximately 77 million.
Eldorado shares and the assumption of Caesars’ outstanding debt of roughly $8.8 billion.
Respectively, Eldorado and Caesars shareholders will hold approximately 51 percent and 49 percent of the shares of the combined company, which will retain the Caesars name.
Shareholders of both companies need to approve the merger, which is expected to close some time next year.
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