by Michael J. Shapiro | June 24, 2019

The recently rumored acquisition of Caesars Entertainment by a smaller competitor, Eldorado Resorts, has become reality. Reno-based Eldorado is paying approximately $17.3 billion in cash and stock for the storied Caesars, in the process creating the largest gaming company in the United States. Although the combined company will retain the Caesars name, the corporate leadership will come from Eldorado and continue to be based in Reno. Eldorado chairman Gary Carano, CEO Tom Reeg, president and COO Anthony Carano, CFO Bret Yunker and chief legal officer and executive vice president Edmund Quatmann Jr. will lead the newly combined Caesars. Officials say the company will still have a significant corporate presence in Las Vegas.

In line with the bigger-is-better mentality that has defined the hospitality industry in recent years, the new Caesars will enjoy the benefits of scale and diversification to the tune of about 60 gaming properties across 16 states. Execs tout synergies of about $500 million as a result of merging the former rivals, and point to the benefits of combining Eldorado's operational expertise with the Caesars Rewards loyalty program, Las Vegas assets and storied brands, as well as the company's regional network outside of Las Vegas.

"Together, we will have an extremely powerful suite of iconic gaming and entertainment brands, as well as valuable strategic alliances with industry leaders in sports betting and online gaming," noted Eldorado CEO Tom Reeg. "The combined entity will serve customers in essentially every major U.S. gaming market, and will marry best-of-breed practices from both entities to ensure high levels of customer satisfaction and significant shareholder returns."

Eldorado has grown significantly via acquisitions in recent years, albeit on a smaller scale than what the Caesars purchase represents. In 2015, the company established a significant presence in downtown Reno by buying out MGM's stake in Circus Circus Reno and the Silver Legacy, which are adjacent to the Eldorado Resort; last year, the three properties were rebranded as one mega-resort called The Row. Among the company's subsequent purchases were Isle of Capri Casinos in 2017 and Tropicana Entertainment last fall.

"As with our past transactions, we have a detailed plan for significant synergy realization," Reeg continued. "We could not be more excited about the future as we bring together two industry leaders that will generate significant opportunities for our employees, customers, partners and shareholders."

For Caesars CEO Tony Rodio, who just accepted that post in April, it isn't the first time he has led a gaming company through an Eldorado acquisition; he served as president and CEO of Tropicana from 2012 to 2018 "I'm familiar with Eldorado and its management team, and I look forward to collaborating  with them to bring our companies together," he said. "We are excited to integrate Caesars Rewards with the combined portfolio."