Caesars Entertainment Corp., the largest casino operator in the U.S., plans to merge with its affiliate Caesars Acquisition Co. in an all-stock transaction that will support a restructuring of its most indebted unit.
The combined company, which will have $1.7 billion in cash, will continue to be controlled by affiliates of Apollo Global Management LLC and TPG Capital and will conduct business as Caesars Entertainment, the companies said in a statement distributed today by PR Newswire. It will be led by Gary Loveman, current chairman and chief executive officer of Caesars Entertainment.
Caesars Entertainment said on Dec. 19 that it struck a deal with some of its senior creditors to put its Caesars Entertainment Operating Co. unit into bankruptcy by mid-January to restructure its $18.4 billion of debt. The Las Vegas-based company must still get more creditors to sign on.
“The successful completion of the merger will position the merged company to support the restructuring of CEOC without the need for any significant outside financing,” the companies said in the statement. “The strength of the merged company will position it to be a strong guarantor for the restructured CEOC’s obligations.”
Caesars isn't the only casino looking to restructure. Hard Rock Hotel & Casino Las Vegas is in talks with a lender to restructure. For more coverage on M&A in the casino industry, see The Buyside: Pinnacle Deal Signifies Gaming Comeback and Eldorado Resorts and MTR Gaming Merge.