Iowa Racing and Gaming Commission recently published an update on the merger of Eldorado and Caesars. However, both companies are yet to resolve some of their issues which will clear the path for Eldorado to own a majority share of the Caesars brand.
Lack of clarity over Operations
The biggest issue at the moment is to decide who will run the sportsbooks of the new company. Caesars already has its own branded sportsbooks operations while Eldorado entered into a 25-year partnership contract with William Hill last year.
According to Eldorado CEO Tom Reeg, the two companies are working on the issue and want to come to an agreement before they close. If the two companies do not close, then William Hill will start running Caesars sportsbooks. The company has intimated details regarding the merger to the Iowa Racing and Gaming Commission during a meeting at the Prairie Meadows Casino Racetrack and Hotel.
Eldorado’s website states that William Hill is running their sportsbooks at nine places in Nevada, Iowa, Mississippi, Indiana and New Jersey. Caesars was running 29 sportsbooks across the US as of September 2019. Both companies seek more exposure in the gambling sector as dozens of states are planning to legalize sports gambling. They may have to sell properties to seek approval from federal and state regulators as well.
Deal to close by early second quarter
Reeg said that the $17.3 billion deal is expected to close in the early second quarter, making the new company the largest casino operator in the country. He noted that both Eldorado and Caesars have a lot of value. He hinted at a more ambitious plan than just letting William Hill run Caesars sportsbooks.
Regulators in Iowa have unanimously approved the deal. The state has previously had companies controlling multiple operations/licenses. The decision will affect two Caesars properties- Harrah’s Council Bluffs Casino and Hotel and Horseshoe Council Bluffs. It will also affect two Eldorado properties- the Isle Casino Hotel Waterloo and Isle Casino Hotel Bettendorf.
Regulators in Illinois, Louisiana, Missouri, and Pennsylvania have already approved the merger. Other states and the US Federal Trading Commission are yet to approve.