As far as major US-based casino entertainment and hospitality company, Caesars Entertainment has a knack for never standing still. From expanding the company’s presence in the legal US sports betting industry to managing land-based casinos all across the country, Caesars remains busy mapping out its future plans in the entire gaming industry.
Caesars Entertainment & Eldorado Resorts
The current base of the company is actually in Reno, Nevada through ownership by the former Eldorado Resorts. A few years back in one of the biggest casino gaming deals ever, Eldorado merged with Las Vegas-based Caesars in a mega $17.3 billion cash and stock buyout.
Soon after the dust cleared on that deal, Caesars got serious about legal sports betting in the US with the company’s acquisition of UK-sports betting giant William Hill. This gave Caesars an immediate in to close the gap against FanDuel, DraftKings and BetMGM has market leaders.
The bigger picture behind this deal was to rebrand William Hill in the US as Caesars Sportsbook. This process started in 2021 and the transition in now complete with the branded Caesars mobile sportsbook app making major inroads in the legal US market.
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Caesars never had any intentions of operating William Hill outside the US market. Last year, the company decided to sell off William Hill’s international business interests to 888 Holdings. As that deal continues its plan to close in 2022, it was revealed that the asking price has been devalued by $415 million.
Caesars Entertainment will receive $785 million in proceeds from the William Hill sale. This has raised speculations as to the company’s future plans in light of the substantial decrease in value.
Morgan Stanley analyst Thomas Allen recently weighed in with his take on the situation as follows:
“We believe CZR (Caesars) made the right call in working with 888 to get this deal over the finish line. While more proceeds are always better, the probability of closing and timeliness is paramount, particularly given the turbulent market conditions, complexity of UK takeover laws and the importance of deleveraging.”
Caesars Entertainment Next Steps
The lower return on the pending sale of William Hill has raised speculations of possible responses by Caesars Entertainment. At the top of the list is the sale of existing Las Vegas Strip casino properties.
The properties listed at the top of the list would be Flamingo Las Vegas, Paris Las Vegas and Planet Hollywood. Any one of the three casinos could spark interest from real estate investment trusts (REIT’s).
These types of companies have access to the necessary capital. They also have a strong interest in Las Vegas gaming properties, especially when it comes to locations on the famed Strip.
VICI Properties is the largest landlord of casino properties. As the owner of Caesars Palace, the company already retains the right of first refusal on any of the three casino properties mentioned above.
Caesars also remains committed to expanding its market presence in both retail and mobile sports betting. The company’s recent successful launch in the legal New York mobile sports betting market reconfirms these aspirations.
