Fertitta Entertainment in Advanced Negotiations for $6.5B Caesars Acquisition
Billionaire Tilman Fertitta’s Fertitta Entertainment is currently in exclusive negotiations to acquire Caesars Entertainment for $32 per share. This values the casino giant’s equity at a whopping $6.5 billion, as reported by CNBC. Factoring in Caesars’ substantial debt, the deal signifies an enterprise value of $31.5 billion.
The negotiations are unfolding within a 45-day exclusive window at Fertitta’s Houston headquarters. If the deal is finalized, it is not expected to close until 2027 due to regulatory requirements. This acquisition would significantly expand Fertitta’s hospitality empire, incorporating Caesars’ 50-plus resorts and casinos into his existing portfolio. His current holdings include the Golden Nugget casino chain, Landry’s restaurants, and the Houston Rockets.
Fertitta’s bid has outdone a competing offer from billionaire Carl Icahn. Icahn’s firm initially proposed $28.50 per share in January and later increased it to $33 per share. Insiders suggest that Icahn may be trying to inflate the deal price to boost the value of his own 1.2 percent stake in Caesars. Notably, Icahn has also placed two directors on Caesars’ board.
The potential deal emerges as Caesars grapples with four consecutive quarters of net losses, impacted by dwindling visitor numbers in Las Vegas. However, insiders close to the negotiations highlight that Caesars generates approximately $1 billion in annual free cash flow and $4 billion in EBITDA. This makes the suppressed share price an enticing opportunity.
Source: CNBC