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Eldorado has yet to make a binding bid for Caesars, and there is no certainty that an offer will materialize or that an agreement will be negotiated successfully, the sources added, asking not to be identified because the case is confidential .
Caesars and Eldorado have market capitalizations of $ 5.4 billion and $ 3.6 billion, respectively. At the end of December, their debts were $ 9.1 billion and $ 3.3 billion respectively.
Caesars declined to comment, while Eldorado did not immediately respond to a request for comment.
The combination of Caesars and Eldorado would create a more formidable contender for the big players in the casino industry, such as Las Vegas Sands, Wynn Resorts and MGM Resorts International.
"The universe of buyers (for Caesars) is limited, and we think that Eldorado is best placed to take full advantage of Caesars' badets," wrote Roch Capital Partners badysts in a research note. March 6th.
Caesars, which counts among its casinos the brands Harrah & Horseshoe, left bankruptcy protection in 2017 after failing to bail out $ 25 billion. At the end of December, it had 53 properties in 14 US states and five countries other than the United States, including the United Kingdom.
Eldorado owns and operates 26 properties in 12 US states.
Last year, Caesars rejected the merger approach of Tilman Fertitta, the billionaire owner of Golden Nugget casinos. This transaction would have essentially been structured as an acquisition by Caesars given its larger size. Fertitta has not submitted a new bid for Caesars this year, according to sources.
Caesars also said that he was exploring strategic alternatives that could lead to some kind of transaction.
Icahn has steadily increased its stake in Caesars in anticipation of an agreement. Last week he revealed that his stake had reached 17.8%, up from 9.8% when he signed his contract with the company's board of directors on March 1st.
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