Eldorado Resorts buy Tropicana Entertainment casino business

Eldorado Resorts buy Tropicana Entertainment casino business

Billionaire investor Carl Icahn has sold his Tropicana Entertainment casino business to regional operator Eldorado Resorts in a deal worth $1.85b.
On Monday, Eldorado announced that it had entered into a definitive agreement to acquire the casino operations of Tropicana Entertainment Inc. for $640m in cash.
The deal involves seven casino properties in six states: the Tropicana Laughlin and the MontBleu in Nevada, Indiana’s Tropicana Evansville, Louisiana’s Belle of Baton Rouge, Mississippi’s Trop Casino Greenville, Missouri’s Lumière Place and the Tropicana Casino in Atlantic City.
The properties operate a combined 7,900 slots, 265 gaming tables, 5,400 hotel rooms and various dining, retail and entertainment options. The additions will bring Eldorado’s total operations to 27 properties offering 26,800 slots and VLTs, over 800 tables and more than 12,500 hotel rooms.
The agreement also involves real estate investment trust Gaming and Leisure Properties Inc (GLPI), which will pay $1.21b for “substantially all of Tropicana’s real estate,” excluding the Montbleu casino in South Lake Tahoe and the Tropicana Aruba Resort and Casino, which Tropicana intends to dispose of separately at a later date as a condition to the deal closing sometime in H2.
Assuming the deal goes through, GLPI will then enter into a master lease agreement with Eldorado for the land under its new casinos at an expected $110m per year. The triple new master lease will run for an initial term of 15 years, with renewals of up to 20 years at Eldorado’s option.
This is the second major deal for Eldorado in recent years, coming after the 2016 acquisition of Isle of Capri Casinos’ 13 gaming properties for $1.7b. Eldorado CEO Gary Carano said the Trop deal “is expected to be accretive, further increase the scale of our regional gaming platform and drive free cash flow growth.”
Carano said Eldorado has identified $40m worth of ‘synergies’ that it expects to realize in its first year of ownership. Eldorado also has “no immediate significant capex plans” for its new properties.
The sale marks Icahn’s exit from the casino business, following last August’s sale of the unfinished Fontainebleau hotel-casino project in Las Vegas for $600m. Icahn used to control the Trump Taj Mahal in Atlantic City but shuttered the property in 2016 after failing to reach a deal with the casino’s unionized workforce.
Torpicana CEO Tony Rodio said he was “incredibly proud” of the company’s legacy since Icahn took over eight years ago, “taking Tropicana from bankruptcy to one of the industry’s true success stories.”
The post Eldorado Resorts buy Tropicana Entertainment casino business appeared first on CalvinAyre.com.
Source: Eldorado Resorts buy Tropicana Entertainment casino business

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