New Jersey regulators approve merger of Caesars Entertainment and Eldorado Resorts

The New Jersey Casino Control Commission approved the $17.3 billion deal following two days of hearings with Eldorado executives. According to an Associated Press report, an antitrust analyst assured the commission that the deal would not concentrate too much of the local casino market.

The new company will still be referred to as Caesars Entertainment, but the AP is reporting that many officials are calling it “New Caesars.” The company owns four of the nine Atlantic City casinos but agreed to a deal in principle to sell Bally’s Atlantic City to Rhode Island-based Twin River Worldwide Holdings.

New Caesars owns 52 properties in 16 states and a handful of other countries around the world. It owns nine properties in Las Vegas, but there have been rumors that one of those properties will be sold.

New Jersey’s approval was the final obstacle standing in the way of the merger. The Federal Trade Commission approved the plan in June after Eldorado sold casinos in Missouri, South Lake Tahoe, California and Louisiana.

In an agreement with New Jersey regulators, Eldorado officials promised regulators that the company would not close its three Atlantic City casinos for at least five years, said that it will spend $400 million improving the facilities over the next three years and reinvest 5 percent of annual revenue in the years after that.

Once the sale of Bally’s is finalized, Caesars will own Harrah’s Atlantic City, Caesars Atlantic City and the Tropicana.

Nevada regulators approved the deal last week and the Indiana Gaming Commission approved the deal around the same time. Indiana regulators forced Eldorado and Caesars to sell three of its five properties in the Hoosier State.

The merger has been in the making for more than a year. After billionaire investor Carl Icahn announced that he bought 10 percent of Caesars Entertainment in February 2019, he began pushing for a sale of the casino company that filed for bankruptcy a few years earlier.

Icahn helped install Tony Rodio as the new CEO of Caesars the following month, who helped Icahn sell Tropicana Entertainment Inc. to Eldorado for $1.85 billion.

By June 2019, financial media outlets were reporting that Caesars and Eldorado were in negotiations over a possible merger. The deal was agreed upon in principle by the end of the month and the only obstacle left was regulator approval.
Eldorado bought a 51 percent controlling interest in Caesars at a $17.3 billion valuation. $7.2 billion was paid in cash and the rest was accounted for through Eldorado stock. Eldorado’s CEO Thomas Reeg will head the new gaming giant.