Eldorado Resorts’ $17 billion (135 billion patacas) acquisition of Caesars Entertainment may have created a new casino powerhouse in the U.S., but it is still very unlikely to be a serious contender in the upcoming license tender in Macau, according to one analyst.
Eldorado Resorts Inc. said the combined company will now own and operate more than 55 casino properties in 16 U.S. states, including eight resorts on the Las Vegas Strip. It will take the iconic name of Caesars Entertainment Corp. going forward as the largest casino owner in the world.
But the largest casino owner in the world will remain a U.S. giant without a Macau foothold, predicts Ben Lee, managing partner of IGamiX Management & Consulting.
“Eldorado is more focused on the domestic market [at present], especially with the new merger,” said Lee. “It’s a giant in the U.S. market but not globally.”
Last year, Caesars became the first international casino operator to formally withdraw from the race for a Japan license, citing the merger as a major domestic distraction. Presently, it has showed no signs of interest in the bidding for the next round of Macau’s licenses.
Caesars decided not to bid for the first round of Macau licenses after the gaming liberalization of the early 2000s, citing regulatory concerns about the gambling enclave.
The Macau gaming concessions are due to expire in June 2022. With just 23 months left on the clock, very little is known about the requirements of the next round of concessions other than speculation that the government may end the satellite casino agreements and that diversification will be likely written into the contracts.
For Lee, the only outsider contender with a real chance in the upcoming tender is Malaysia’s Genting, who are currently building a property by Nam Van Lake that may or may not house a small casino. The property is tentatively set to open in 2022.
The Eldorado-Caesars merger involves properties across the United States, including in Arizona, Colorado, Florida, Illinois, Iowa, Mississippi, North Carolina, Ohio, Pennsylvania, Maryland and Las Vegas.
In Vegas, the combined company now owns Caesars Palace, Paris Las Vegas, Planet Hollywood, Harrah’s Las Vegas, the Flamingo, Linq Hotel, Cromwell, Bally’s, and the Rio off the Strip. It will be one of the largest employers in Nevada.
“We are pleased to have completed this transformative merger,” Tom Reeg, former CEO of Eldorado Resorts and now CEO of Caesars Entertainment Inc. said in a statement.
Reeg promised to welcome the combined company’s tens of thousands of employees and create value for stakeholders by using “strategic initiatives that will position the company for continued growth.”
The buyout also affects Caesars properties in the United Kingdom, Egypt, Canada, Dubai and a golf course in Macau. The company vaulted over MGM Resorts International as the world’s largest casino operation.
Trading under the Caesars stock symbol, CZR, began Tuesday in the U.S., according to Anthony Carano, company president and chief operating officer.
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