LAS VEGAS, Nov. 16, 2017 /PRNewswire/ -- Caesars
Entertainment Corporation (NASDAQ: CZR, "Caesars") today announced
it has entered into a definitive agreement to acquire Centaur
Holdings, LLC ("Centaur") for $1.7
billion in cash, including $1.625
billion at closing and $75
million in deferred consideration. As a result of the
transaction, Caesars will add Hoosier Park Racing and Casino
("Hoosier Park") in Anderson,
Indiana, and the Indiana Grand Racing and Casino ("Indiana
Grand") in Shelbyville, Indiana to
its Total Rewards network.
"The addition of Centaur is the first example of our
post-emergence, inorganic growth strategy," said Mark Frissora, President and Chief Executive
Officer of Caesars Entertainment. "The acquisition of Centaur
represents an excellent opportunity to enter into a growing region.
We anticipate that the deployment of Total Rewards will bring
substantial benefits to current Centaur customers and the
implementation of our centralized supply chain and efficient
operating model will drive synergies."
Centaur welcomes more than 6.5 million guests each year across
its properties and serves more than 1.1 million members as part of
its loyalty program. Caesars Entertainment considers central
Indiana an attractive region for
investment based on the combination of under-penetration and
favorable economic fundamentals. Hoosier Park and Indiana
Grand, which serve the Indianapolis area, will add to the Caesars
network, which includes Horseshoe Hammond and Horseshoe
Southern Indiana. Horseshoe Hammond serves the
Chicagoland area and Horseshoe Southern Indiana serves the southern
Indiana and Louisville area.
"We are impressed with Centaur's operations and culture, and the
strong presence it has built in its host communities. Together, we
will build on our respective value creation and execution
achievements for the benefit of customers, employees and local
partners," Mr. Frissora said. "We look forward to welcoming
Centaur's properties, guests and employees to the Caesars
Entertainment family."
Offering gaming, racing, dining, and entertainment, both Hoosier
Park and Indiana Grand feature over 2,000 of the latest slots and
electronic table games, multiple dining outlets, and both live and
simulcast horse racing.
"We believe the acquisition of Centaur is the best use of
capital to support our growth plans and the long-term value of
Caesars Entertainment. Our network expansion plan is off to a great
start with this strategic transaction and we continue to have a
strong financial position with solid cash flows to pursue other
expansion opportunities with attractive returns," concluded Mr.
Frissora.
The transaction is subject to receipt of regulatory approvals
and other customary closing conditions and is expected to close in
the first half of 2018. Transaction financing remains under
consideration subject to determination of final arrangements. The
purchase price represents an 8.3x implied multiple in year two
following the closing of the transaction, inclusive of expected
synergies. The Company anticipates introducing table games to these
properties, pending regulatory approval. Assuming the introduction
of table games and certain synergies, the effective purchase price
multiple would be less than 7x at that time. The transaction is
anticipated to be free cash flow positive.
About Caesars Entertainment
Caesars Entertainment is the world's most diversified
casino-entertainment provider and the most geographically
diverse U.S. casino-entertainment company. Since its
beginning in Reno, Nevada, in 1937, Caesars
Entertainment has grown through development of new resorts,
expansions and acquisitions and its portfolio of subsidiaries now
operate 47 casinos in 13 U.S. states and five
countries. Caesars Entertainment's resorts operate
primarily under the Caesars®, Harrah's® and Horseshoe® brand
names. Caesars Entertainment's portfolio also includes
the Caesars Entertainment UK family of
casinos. Caesars Entertainment is focused on building
loyalty and value with its guests through a unique combination of
great service, excellent products, unsurpassed distribution,
operational excellence and technology leadership. Caesars
Entertainment is committed to environmental sustainability and
energy conservation and recognizes the importance of being a
responsible steward of the environment. For more information,
please visit www.caesars.com.
Forward Looking Information
This release includes "forward-looking statements" intended to
qualify for the safe harbor from liability established by the
Private Securities Litigation Reform Act of 1995. In particular,
they include statements relating to, among other
things, Caesars Entertainment's plans, strategies,
opportunities for growth and consummation of the proposed
acquisition of Centaur. You can identify these statements by the
fact that they do not relate strictly to historical or current
facts. Further, these statements contain words such as "believe",
"will", "expects", "plans", "anticipate" and "continue to" or the
negative or other variations thereof or comparable terminology.
These forward-looking statements are based on current expectations
and projections about future events.
Investors are cautioned that forward-looking statements are not
guarantees of future performance or results and involve risks and
uncertainties that cannot be predicted or quantified, and,
consequently, the actual performance of Caesars
Entertainment may differ materially from those expressed or
implied by such forward-looking statements. Such risks and
uncertainties include, but are not limited to, the following
factors, and other factors described from time to time
in Caesars Entertainment's reports filed with
the Securities and Exchange Commission (including the
sections entitled "Risk Factors" and "Management's Discussion and
Analysis of Financial Condition and Results of Operations"
contained therein):
- Completion of the transaction described herein is subject to
receipt of regulatory approvals and other closing conditions, which
may not be satisfied;
- the impact of our new operating structure post-emergence;
- the effects of local and national economic, credit, and capital
market conditions on the economy, in general, and on the gaming
industry, in particular;
- the ability to realize improvements in our business and results
of operations through our property renovation investments,
technology deployments, business process improvement initiatives
and other continuous improvement initiatives;
- the ability to take advantage of opportunities to grow our
revenue;
- the financial results of our consolidated businesses;
- the impact of our substantial indebtedness and lease
obligations and the restrictions in our debt and lease
agreements;
- access to available and reasonable financing on a timely basis,
including the ability of Caesars Entertainment to
refinance its indebtedness on acceptable terms;
- the ability of our customer tracking, customer loyalty, and
yield management programs to continue to increase customer loyalty
and same-store or hotel sales;
- changes in the extensive governmental regulations to which we
are subject, and changes in laws, including increased tax rates,
smoking bans, regulations or accounting standards, third-party
relations and approvals, and decisions, disciplines and fines of
courts, regulators and governmental bodies;
- our ability to recoup costs of capital investments through
higher revenues;
- abnormal gaming holds ("gaming hold" is the amount of money
that is retained by the casino from wagers by customers);
- the effects of competition, including locations of competitors,
growth of online gaming, competition for new licenses, and
operating and market competition;
- the ability to timely and cost-effectively integrate companies
that we acquire into our operations;
- the potential difficulties in employee retention and
recruitment;
- construction factors, including delays, increased costs of
labor and materials, availability of labor and materials, zoning
issues, environmental restrictions, soil and water conditions,
weather and other hazards, site access matters, and building permit
issues;
- litigation outcomes and judicial and governmental body actions,
including gaming legislative action, referenda, regulatory
disciplinary actions, and fines and taxation;
- acts of war or terrorist incidents, (including the impact of
the recent mass shooting in Las Vegas on tourism), severe
weather conditions, uprisings or natural disasters, including
losses therefrom, losses in revenues and damage to property, and
the impact of severe weather conditions on our ability to attract
customers to certain of our facilities;
- the effects of environmental and structural building conditions
relating to our properties;
- a disruption, failure or breach of our network, information
systems or other technology, or those of our vendors, on which we
are dependent;
- risks and costs associated with protecting the integrity and
security of internal, employee and customer data;
- access to insurance on reasonable terms for our assets;
and
- the impact, if any, of unfunded pension benefits under
multiemployer pension plans.
Any forward-looking statements are made pursuant to the Private
Securities Litigation Reform Act of 1995 and, as such, speak only
as of the date made. Caesars
Entertainment disclaims any obligation to update the
forward-looking statements. You are cautioned not to place
undue reliance on these forward-looking statements, which speak
only as of the date stated or, if no date is stated, as of the date
of this release.
About Centaur Gaming
Indianapolis-based Centaur
Holdings, LLC, founded in 1993, focuses on bringing the
entertainment and economic benefits of casino gaming and horse
racing to key communities across Indiana. Centaur currently owns and operates
Hoosier Park Racing & Casino in Anderson, Ind., Indiana Grand Racing &
Casino in Shelbyville, Winner's
Circle Pub, Grille & OTB in Indianapolis, Winner's Circle OTB and VooDoo
BBQ and Grill in New
Haven/Fort Wayne, and an
additional off-track betting location in Clarksville. For more information, please
visit www.centaurgaming.net.
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SOURCE Caesars Entertainment Corporation