Eldorado Resorts, Inc. announced today that it completed its previously announced acquisition of Tropicana
Entertainment Inc. The transaction further increases the Company’s scale and is expected to be immediately accretive to Eldorado’s free cash flow and diluted earnings per share, inclusive of identified expected cost synergies of approximately $40 million expected to be realized in Eldorado’s first year of operation of Tropicana (and giving effect to the master lease described below). The combination creates a premier, diversified regional gaming platform with combined annual revenue of more than $2.7 billion and combined adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of approximately $697 million (before rent and after giving effect to the realization of synergies), in each case for the twelve months ended 30 June 2018 and giving effect to the acquisition of Grand Victoria Casino - Elgin and the previously announced dispositions of Presque Isle Downs & Casino and Lady Luck Casino - Nemacolin.
Under the terms of the transaction, valued at approximately $1.85 billion, a subsidiary of Eldorado merged into Tropicana and Tropicana became a wholly owned subsidiary of Eldorado. Immediately prior to the merger, Tropicana sold Tropicana Aruba Resort and Casino and Gaming and Leisure Properties acquired substantially all of Tropicana’s real estate, other than the real estate underlying MontBleu Resort Casino & Spa and Lumiere Place Casino and Hotel, for approximately $964 million and Eldorado acquired the real estate underlying Lumière Place for $246 million. Eldorado also entered into a 15-year master lease with GLPI pursuant to which Eldorado will lease the Tropicana real estate acquired by GLPI. Eldorado funded the purchase of the real estate underlying Lumière Place with the proceeds of a loan from GLPI and funded the $640 million of consideration payable by Eldorado in the merger and the repayment of amounts outstanding under the Tropicana credit facility with cash on hand at Eldorado and Tropicana, borrowings under Eldorado’s revolving credit facility and proceeds from its previously-announced offering of $600 million in aggregate principal amount of 6% senior notes due 2026. Eldorado will pay GLPI approximately $110 million in rent and interest in the first year.
The acquisition of Tropicana brings to Eldorado the operating assets of seven casinos in six states, including Nevada (the Tropicana Laughlin Hotel & Casino and the MontBleu Resort Casino & Spa in South Lake Tahoe), Indiana (Tropicana Evansville), Louisiana (Belle of Baton Rouge Casino), Mississippi (Trop Casino Greenville), Missouri (Lumiere Place) and New Jersey (Tropicana Atlantic City Casino & Resort). These properties collectively include approximately 7,900 slot machines, 265 table games and approximately 5,400 hotel rooms, along with a number of dining, retail and entertainment amenities. As a result, Eldorado’s expanded property portfolio now features more than 27,500 slot machines and VLTs, more than 800 table games, over 12,500 hotel rooms and nearly 20,000 team members.
Gary Carano, Chairman and Chief Executive Officer of Eldorado, commented, “Our acquisition of Tropicana marks a continuation of Eldorado’s successful history of rapid growth through strategic, accretive acquisitions. Through this combination, we have significantly expanded the scale of our gaming operations, further diversified our geographic reach into new markets – some of which have already adopted sports wagering legislation — and minimized market-specific risk. We continue to focus on enhancing shareholder value through strategic transactions, return-focused property enhancements and opportunistic partnerships with third parties – including the Tropicana transaction, the Grand Victoria acquisition and our recent agreements with The Cordish Companies and William Hill PLC. 카지노사이트먹튀
“We intend to reduce the initial purchase price multiple of the Tropicana transaction as we implement a range of operating disciplines designed to enhance margins by further improving customer service and the customer experience while focusing on promotion and other spending in all areas of the newly-acquired properties. We look forward to welcoming Tropicana’s team members to the Eldorado Resorts family.”