Eldorado will pay $8.40 per share in cash and 0.0899 shares of Eldorado stock for each Caesars share, or $12.75 per share. The company, which emerged from bankruptcy in 2017, operates casinos with the Harrah's and Horseshoe brands.
"Eldorado's combination with Caesars will create the largest owner and operator of USA gaming assets and is a strategically, financially, and operationally compelling opportunity that brings immediate and long-term value to stakeholders of both companies", said Tom Reeg, CEO of Eldorado. The acquisition Monday puts about 60 casinos and resorts in 16 states under a single name, creating one of the biggest gambling and entertainment ventures in the U.S.
Caesars' stock jumped 12.2 percent before the market opened, while shares of Eldorado fell 6.6 percent.
Icahn said he was "pleased" by the deal announcement. In late February of this year, it was Icahn who proposed Anthony Rodio to succeed Mark Frissora as Caesars's CEO.
The most famous property in Caesars' portfolio is the luxury hotel and casino Caesars Palace, created in 1966 with an interior designed to resemble the opulence of the Roman Empire. Going forward, the newly-merged company will be known as Caesars and will be headquartered in Reno where Eldorado is based.
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Eldorado CEO Tom Reeg similarly expressed optimism regarding the newly-combined company's future. As a combined company, Caesars and Eldorado will be America's preeminent gaming company. Golden Nugget owner Tilman Fertitta proposed merging his restaurant and casino empire with Caesars previous year, but was rejected by Caesars.
"Eldorado's combination with Caesars will create the largest owner and operator of USA gaming assets", Eldorado CEO Tom Reeg said in a statement. For months, Caesars shareholder Carl Icahn has been urging the casino company to work out a purchase.
FILE PHOTO: The 550 foot-tall (167.6 m) High Roller observation wheel, the tallest in the world, is the centerpiece of the $550 million Linq project, a retail, dining and entertainment district by Caesars Entertainment Corp, in seen in Las Vegas, Nevada April 9, 2014. It had long-term debt of about $3.06 billion at the end of March.
Eldorado said Monday it has also reached a real estate agreement with VICI Properties in which VICI will acquire the real estate associated with Harrah's Resort Atlantic City, Harrah's Laughlin Hotel & Casino and Harrah's New Orleans Hotel & Casino for approximately $1.8 billion.