Caesars Entertainment Corp.’s Caesars Palace casino stands in Las Vegas, Nevada.
Jacob Kepler | Bloomberg | Getty Images
U.S. casino operator Eldorado Resorts has agreed to merge with Caesars Entertainment in a $17.3 billion cash-and-stock deal, including debt, the companies said on Monday.
Reuters, citing people familiar with the matter, reported on Sunday that Eldorado had clinched a deal with Caesars.
The agreement comes three months after Reuters reported that Caesars had agreed to give Eldorado access to its books under pressure from billionaire investor Carl Icahn, who earlier this year was awarded seats on Caesars board.
Eldorado’s offer of $12.75 per share represents a premium of about 28% to Caesar’s closing price on Friday and an equity valuation of about $8.54 billion.
Caesars, which emerged from bankruptcy in 2017, operates casinos with the Harrah’s and Horseshoe brands.
The company had 53 properties in 14 U.S. states and five countries outside the United States at the end of March, and its long-term debt stood at $8.79 billion.
The combination of the two companies would create a serious competitor to larger casino industry players, such as Las Vegas Sands, Wynn Resorts, and MGM Resorts.
Caesars’ shares closed on Friday at $9.99. The company, which emerged from bankruptcy protection in 2017, operates casinos with the Harrah’s and Horseshoe brands. It had 53 properties in 14 U.S. states and five countries outside the United States at the end of December.
Eldorado has a market value of about $4 billion. It had long-term debt of about $3.06 billion at the end of March. The company owns and operates 26 properties in 12 U.S. states.
Eldorado and Caesars shareholders will hold about 51% and 49% of the combined company’s outstanding shares.
—CNBC contributed to this report.
