Louisiana law change means big business for Eldorado
Eldorado Resorts has received the all clear from the Louisiana Gaming Control Board to move its Isle of Capri riverboat casino to dry land.
Casino.org reports that Eldorado is the first operator in Louisiana to receive such an approval.
In 2018, Louisiana lawmakers passed a bill that was later signed by Governor John Bel Edwards, allowing the state’s 15 riverboats to come onto land.
It was under the condition that the operators are to be held within 1,200 feet of the original licensed docking site.
In August 2018, it was reported by Casino.org that three Louisiana riverboat casinos wanted to come ashore.
They included Belle of Baton Rouge, also an Eldorado owned venture, the Treasure Chest Casino in Kenner and an unidentified venue.
A copy of last week’s Louisiana Gaming Control Board’s meeting agenda confirms the agency dismissed Eldorado’s pitch to move the Isle of Capri onto dry land, and that the matter was unanimously approved.
Change to Louisiana’s gaming operations
The passage of last year’s law allows operators to bring riverboat casinos ashore, expanding their gaming areas.
That legislation reversed a previous cap on gaming space of just 30,000 feet, while allowing gaming companies to add more slot machines and table games.
Reno-based Eldorado plans to take advantage of that opportunity in Louisiana.
It has said it will spend nearly $113 million for a land-based casino that will feature 72,000 square feet of gaming space, 1,271 slot machines and 46 table games.
In its current form, the Isle of Capri has just 36 table games and barely more than 1,100 gaming machines.
Construction of the land-based property will commence at the end of next month, with a May 2021 target in mind.
Included in the law allowing riverboat casinos to come to land is a requirement for enhanced economic contributions on operators’ parts.
Though 22 maritime0related jobs will be lost when the isle of Capri comes ashore, Eldorado plans to employ 804 people on land, compared to 735 on the riverboat.
More than 300 construction jobs are said to be created to build the brick-and-mortar gaming property.
Caesars acquisition likely to see changes in Louisiana portfolio
Eldorado’s footprint in Louisiana is set to increase with its $17.3 billion purchase of Caesars Entertainment.
The deal is expected to close in the first quarter of 2020.
In addition to the Isle of Capri, the company runs the Belle of Baton Rouge and Eldorado Casino Resort in Shreveport.
Caesars currently operates Louisiana’s lone land-based casino – Harrah’s New Orleans – as well as Harrah’s Louisiana Downs and the Horseshoe Bossier City.
It remains to be seen if the combined company divests a property or two in Louisiana.
Eldorado buys Caesars
In the casino business, it’s the minnow swallowing the whale.
Japan Times reported in June that Eldorado Resorts Inc’s $8.58 billion acquisition of Caesars Entertainment Corp means an underdog from Reno, Nevada – a town long in the shadow of Las Vegas – will become the largest owner of casinos in the US.
In the deal announced, Caesars shareholders will receive about $12.75 a share, including $8.40 in cash.
That’s a 28 per cent premium to the casino chain’s close on the Friday preceding the announcement.
While the combined company will retain the Caesars name, there’s no mistaking who’s buying whom in this transaction: Eldorado, with a market value of less than $4 billion, is clinching the giant from Las Vegas and its flagship Caesars Palace.
Eldorado’s quick ascent to the top of the industry benefited from a campaign by activist billionaire Carl Icahn, Caesars’ biggest shareholder, who pushed for a sale in recent months.
The Reno company is buying an ailing Caesars, still coping with the fallout of a 2008 leveraged buyout that left it with a mountain of debt.
But it wasn’t the only suitor: Golden Nugget owner Tilman Fertitta proposed merging his restaurant and casino empire with Caesars last year.
Eldorado dates back to a single casino opened in Reno in 1973 by Donald Carano, a lawyer who died in 2017.
The town, which calls itself “The Biggest Little City in the World” has always been the second fiddle of Nevada’s gambling industry.
The business has grown exponentially in recent years under the direction of Tom Reeg, who is now chief executive officer and will lead the combined Eldorado-Caesars along with Chairman Gary Carano and the rest of Eldorado’s management.
Among its purchases, Eldorado acquired MTR Gaming Group and Isle of Capri Casinos, and last year added Tropicana Entertainment, which was controlled by Icahn.