Caesars Entertainment Agrees to Sell World Series of Poker® Brand to NSUS Group for US$500 million

Rhea-AI Summary

Caesars Entertainment (NASDAQ: CZR) has agreed to sell the World Series of Poker® (WSOP) brand to NSUS Group for US$500 million. The deal includes $250 million in cash and a $250 million promissory note due in five years. Caesars retains the right to host the flagship WSOP summer series in Las Vegas for 20 years and will continue to use WSOP branding in its brick-and-mortar poker rooms. Caesars Digital will maintain its WSOP Online real-money poker business in select states. The transaction is expected to close by the end of 2024, subject to regulatory approvals.

NSUS Group, known for operating GGPoker, plans to expand WSOP globally and enhance the player experience using GGPoker's technology. This strategic move aims to position WSOP at the forefront of poker's growth worldwide.

Positive

• Sale of WSOP brand for US$500 million, providing significant cash influx
• Retention of rights to host flagship WSOP summer series for 20 years
• Continued use of WSOP branding in Caesars' brick-and-mortar poker rooms
• Caesars Digital maintains WSOP Online real-money poker business in select states
• Potential for global expansion and growth of WSOP brand under NSUS Group

Negative

• Loss of full ownership and control over the WSOP brand
• Restriction on operating online peer-to-peer real-money poker operations for a specified period
• Dependence on NSUS Group for future development and management of the WSOP brand

Insights

Financial Analyst

This US$500 million deal between Caesars Entertainment and NSUS Group for the World Series of Poker (WSOP) brand is a significant transaction in the gaming industry. The structure of the deal - $250 million in cash and a $250 million promissory note - provides Caesars with immediate liquidity while also securing future cash flow.

From Caesars' perspective, this deal allows them to monetize a valuable asset while retaining key operational rights. The 20-year agreement to host the WSOP's flagship tournament in Las Vegas ensures a continued revenue stream and maintains brand association. Additionally, keeping WSOP branding in their brick-and-mortar poker rooms and retaining rights for WSOP Circuit events preserves valuable marketing opportunities.

For NSUS Group, acquiring the WSOP brand presents significant growth potential, especially in the online poker space. Given their success with GGPoker, NSUS is well-positioned to leverage the WSOP brand globally, potentially leading to increased revenue streams.

Investors should note that while Caesars is divesting the WSOP brand, they're maintaining important operational aspects. This strategy allows them to focus on core casino operations while still benefiting from the WSOP's prestige. The deal's structure also provides Caesars with a substantial cash injection, which could be used for debt reduction or reinvestment in other areas of their business.

Overall, this transaction appears to be a strategic move that could benefit both parties, with Caesars optimizing its asset portfolio and NSUS gaining a powerful brand to expand its online poker presence.

Gaming Industry Expert

The sale of the World Series of Poker brand to NSUS Group marks a significant shift in the poker landscape. This $500 million deal underscores the immense value of the WSOP brand and its potential for growth, particularly in the online sphere.

NSUS Group, known for GGPoker, has demonstrated its ability to innovate in the online poker space. Their acquisition of WSOP positions them to potentially revolutionize how the brand operates in the digital realm. We might see a more aggressive expansion of WSOP-branded online tournaments and series, leveraging GGPoker's technology to enhance player experience.

Interestingly, Caesars' retention of rights to host the flagship WSOP summer series in Las Vegas for 20 years ensures the tournament's traditional format remains intact. This hybrid approach - combining NSUS's online expertise with Caesars' land-based experience - could lead to a more integrated poker ecosystem, bridging the gap between online and live play.

The deal's structure also reveals a careful balancing act. Caesars maintains its WSOP-branded brick-and-mortar operations and online presence in key U.S. states, while NSUS gains the ability to expand the brand globally. This arrangement could lead to increased competition in the international online poker market, potentially challenging established players like PokerStars.

For the poker industry as a whole, this deal signals a continued shift towards online play, while also recognizing the enduring appeal of live tournaments. It's a testament to poker's resilience and adaptability in the face of changing gaming landscapes.

Legal Expert

The $500 million sale of the World Series of Poker brand from Caesars Entertainment to NSUS Group presents several interesting legal considerations. First and foremost, the deal's structure - split between cash and a promissory note - requires careful legal drafting to ensure enforceability and security.

The 20-year agreement for Caesars to host the WSOP's flagship tournament in Las Vegas is a important aspect of the deal. This long-term contract will need robust clauses to address potential changes in circumstances, such as regulatory shifts or unforeseen events that could impact the tournament's viability.

Licensing agreements are another key legal component. Caesars' retention of rights to use WSOP branding in their brick-and-mortar poker rooms and to operate WSOP Online in specific states will require clear terms to prevent potential conflicts with NSUS's broader rights to the brand.

The deal's mention of Caesars being "restricted from operating online peer-to-peer real-money poker operations for a specified period of time and subject to certain exceptions" is particularly noteworthy. This non-compete clause will need careful definition to avoid future disputes while complying with antitrust regulations.

Regulatory approvals, as mentioned in the article, will be crucial. Given the high-profile nature of the WSOP brand and its significance in the gaming industry, regulators will likely scrutinize this deal closely, particularly regarding how it might impact market competition and consumer protection in online poker.

Overall, this transaction's complexity underscores the need for comprehensive legal oversight to ensure all parties' interests are protected and regulatory requirements are met.

Caesars retains the right to host the flagship WSOP summer series on the Las Vegas Strip for 20 years and its licenses to use the WSOP brand for its brick-and-mortar and online poker operations

TORONTO & LAS VEGAS--(BUSINESS WIRE)-- Caesars Entertainment, Inc. (NASDAQ: CZR) (“Caesars”) today announced the signing of a definitive agreement to sell its intellectual property rights for the World Series of Poker^® (“WSOP”) brand to NSUS Group Inc. (“NSUS”), a leading investment group in the iGaming space known for successfully launching several groundbreaking ventures, including the innovative online poker room, GGPoker. The transaction, valued at a total of US$500 million, includes US$250 million in cash and a $250 million promissory note due five years after the transaction’s closing date (the “Closing”) secured by the WSOP intellectual property assets being sold.

As a part of this transaction, Caesars has secured the right from NSUS to continue hosting the WSOP’s flagship live tournament series at its Las Vegas casinos for the next 20 years. In addition, brick-and-mortar poker rooms currently operated by Caesars will continue to feature WSOP branding, and Caesars destinations will continue to enjoy preferential rights to host live WSOP Circuit (WSOP-C) events going forward.

Caesars Digital will also receive a license from NSUS to continue operating its recently upgraded WSOP Online real-money poker business in Nevada, New Jersey, Michigan, and Pennsylvania for the foreseeable future but will otherwise be restricted from operating online peer-to-peer real-money poker operations for a specified period of time and subject to certain exceptions.

“We’ve enjoyed a longstanding and successful partnership with GGPoker that has helped spur the growth of the WSOP brand,” said Eric Hession, President of Caesars Digital. “This transaction is an exciting step for Caesars as a company and the WSOP brand as it continues to evolve. We can’t wait to see what NSUS has in store for growing the WSOP’s legacy in poker, and we look forward to continuing to deliver an unmatched and familiar experience to poker players going forward.”

“After collaborating with Caesars Entertainment for years, NSUS Group, the operators of GGPoker, is thrilled to announce their new role in leading the World Series of Poker, the world’s most renowned poker brand,” said Michael Kim, Chief Executive Officer of NSUS Group Inc. “We will leverage GGPoker’s cutting-edge technology and industry expertise to create an exciting future for WSOP, ensuring players have an increasingly improved, safe, and seamless poker experience. Under the new leadership, NSUS intends to expand WSOP worldwide, positioning it at the forefront of poker’s growth.”

This sale is subject to customary regulatory approvals and other closing conditions and is expected to close prior to the end of 2024. Kirkland & Ellis LLP provided transactional counsel and Latham & Watkins LLP acted as finance counsel to Caesars, while NSUS was represented by Greenberg Traurig, LLP.

About Caesars Entertainment, Inc.

Caesars Entertainment, Inc. (NASDAQ: CZR) is the largest casino-entertainment Company in the U.S. and one of the world’s most diversified casino-entertainment providers. Since its beginning in Reno, NV, in 1937, Caesars Entertainment, Inc. has grown through development of new resorts, expansions and acquisitions. Caesars Entertainment, Inc.’s resorts operate primarily under the Caesars®, Harrah’s®, Horseshoe®, and Eldorado® brand names. Caesars Entertainment, Inc. offers diversified gaming, entertainment and hospitality amenities, one-of-a-kind destinations, and a full suite of mobile and online gaming and sports betting experiences. All tied to its industry-leading Caesars Rewards loyalty program, the Company focuses on building value with its guests through a unique combination of impeccable service, operational excellence and technology leadership. Caesars is committed to its employees, suppliers, communities and the environment through its PEOPLE PLANET PLAY framework. Know When To Stop Before You Start.® Gambling Problem? Call or text 1-800-GAMBLER. For more information, please visit www.caesars.com/corporate.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the federal securities laws. You can identify these statements by our use of the words "anticipates," "assumes," "believes," "estimates," "expects," "guidance," "intends," "plans," "projects," and similar expressions that do not relate to historical matters. Forward-looking statements include all statements other than statements of historical fact, including statements regarding market performance and expected timing of consummation of operations. You should exercise caution in interpreting and relying on forward-looking statements because they involve known and unknown risks, uncertainties, and other factors which are, in some cases, beyond Caesars' control and could materially affect actual results, performance, or achievements. Although Caesars believes that in making such forward-looking statements its expectations are based upon reasonable assumptions, such forward-looking statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. Caesars cannot assure you that the assumptions upon which these statements are based will prove to have been correct. Caesars does not undertake any obligation to update or revise any forward-looking statement, whether as a result of new information, future events, or otherwise, except as may be required by applicable law.

About World Series of Poker:

Part of Caesars Entertainment's Caesars Digital operations, the World Series of Poker® is the largest, richest and most prestigious gaming event in the world, having awarded more than $4 billion in prize money and awarding prestigious gold bracelets, globally recognized as the sport's most coveted prize. Featuring a comprehensive slate of tournaments in every major poker variation, the WSOP is poker's longest-running tournament dating back to 1970. In 2024, the event attracted 229,553 entrants to Paris Las Vegas and Horseshoe Las Vegas and awarded more than $438 million in prize money – both all-time records for the series. In addition, the WSOP has formed groundbreaking alliances in broadcasting, digital media and corporate sponsorships, while successfully expanding the brand internationally. Today, in addition to the flagship World Series of Poker in Las Vegas, the WSOP portfolio of events includes approximately 40 WSOP Circuit Events annually across five continents, WSOP Europe (since 2007) and WSOP Paradise (since 2023.) All WSOP events are subject to the then-current and applicable WSOP tournament rules. For more information, please visit www.wsop.com.

About NSUS Group: NSUS, pronounced "Answers,” is at the forefront of business consultancy to leading firms within the iGaming space. Specializing in investments, consulting and marketing, NSUS has been an integral part of the launch of several highly successful ventures, such as GGPoker, the World’s Biggest Poker Room, and ClubGG. These brands are the market leaders in the iGaming industry, providing fun and entertainment to millions of players around the world.

https://www.nsusgroup.com/

About GGPoker: GGPoker is the World’s Biggest Poker Room, with a global player base. It offers a range of innovative games and features such as the patented Rush & Cash poker, All-In or Fold, Flip & Go, Spin & Gold, Mystery Battle Royale, GGCare & GGCheers, integrated staking platform, SnapCam video messaging, PokerCraft, and Smart HUD, all designed to enhance gaming experiences and make poker more fun than ever.

In 2020, GGPoker hosted the world record-breaking WSOP Online main event. In 2022, GGPoker became the world’s largest online poker room and was awarded the Online Poker Operator of the Year Award at the SiGMA Americas Gaming Awards. In PokerListings’ 2022 Operator Awards, GGPoker won the Best Poker Operator, Best Poker Innovation and Best Online Series awards. GGPoker sent over 1,000 players to WSOP Paradise at the Atlantis Paradise Island in the Bahamas in 2023, while more than 1,100 GGPoker players took their seats in the WSOP 2024 Main Event, which smashed attendance records for the second year running.

Find out more about GGPoker at GGPoker.com and on Facebook, X and Reddit.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240801682172/en/

Investor Relations:

Brian Agnew, bagnew@caesars.com

Charise Crumbley, ccrumbley@caesars.com

800-318-0047

Media Relations:

Kate Whiteley, kwhiteley@caesars.com

Brad Harwood, bharwood@caesars.com

GGPoker, press@ggpoker.com

Source: Caesars Entertainment, Inc.

FAQ

How much is Caesars Entertainment selling the World Series of Poker brand for?

Caesars Entertainment (CZR) is selling the World Series of Poker brand to NSUS Group for US$500 million, consisting of $250 million in cash and a $250 million promissory note due in five years.

Will Caesars Entertainment (CZR) still host the WSOP tournament after the sale?

Yes, Caesars Entertainment (CZR) has secured the right to continue hosting the flagship WSOP summer series at its Las Vegas casinos for the next 20 years as part of the agreement.

Can Caesars Entertainment (CZR) still use the WSOP brand for online poker after the sale?

Caesars Digital will receive a license to continue operating its WSOP Online real-money poker business in Nevada, New Jersey, Michigan, and Pennsylvania, but will be restricted from other online peer-to-peer real-money poker operations for a specified period.

When is the sale of the WSOP brand by Caesars Entertainment (CZR) expected to close?

The sale of the WSOP brand by Caesars Entertainment (CZR) to NSUS Group is expected to close prior to the end of 2024, subject to customary regulatory approvals and other closing conditions.