Caesars Entertainment, Inc. Enters Agreement to Divest Caesars Southern Indiana to the Eastern Band of Cherokee Indians
Caesars Entertainment (CZR) has entered a definitive agreement to sell the operations of Caesars Southern Indiana for $250 million to the Eastern Band of Cherokee Indians (EBCI). This transaction will result in a $32.5 million annual reduction in payments to VICI Properties (VICI) post-closing. Additionally, Caesars and EBCI will extend their partnership, allowing the continued use of the Caesars brand and Rewards loyalty program at the property. The deal is expected to close in Q3 2021, pending regulatory approvals.
- Sale of Caesars Southern Indiana for $250 million enhances liquidity.
- Reduction of $32.5 million in annual lease payments to VICI Properties improves cash flow.
- Regulatory approvals could delay or block the transaction.
- Dependence on the successful transition of operations may impact future performance.
RENO, Nev. and LAS VEGAS, Dec. 24, 2020 /PRNewswire/ -- Caesars Entertainment, Inc. (NASDAQ: CZR) ("Caesars" or "CZR") today announced a definitive agreement to sell the operations of Caesars Southern Indiana to the Eastern Band of Cherokee Indians ("EBCI") for
Additionally, effective as of the closing of the transaction, Caesars and the Eastern Band of Cherokee Indians will extend their existing relationship by entering into a long-term agreement for the continued use of the Caesars brand and Caesars Rewards loyalty program at Caesars Southern Indiana.
"Expanding our relationship with the Eastern Band of Cherokee Indians is an exciting event for Caesars Entertainment," said Tom Reeg, CEO of Caesars Entertainment, Inc. "Since our partnership began back in 1996, we have admired their growth and the success of their properties. We look forward to increasing our relationship by extending the Caesars brand and Caesars Rewards loyalty program to them at Caesars Southern Indiana."
"The purchase of Caesars Southern Indiana operating company marks the beginning of an exciting new future for the Eastern Band of Cherokee Indians," said Richard Sneed, Principal Chief Eastern Band of Cherokee Indians. "We are pleased to build upon our long-standing partnership with Caesars as we look to advance our interests in commercial gaming in the coming years."
The transaction is expected to close in the third quarter of 2021 and is subject to regulatory approvals and other customary closing conditions.
J.P. Morgan and Latham & Watkins LLP represented Caesars Entertainment on the transaction. Innovation Capital LLC and Brownstein Hyatt Farber Schreck represented the Eastern Band of Cherokee Indians.
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, Nevada, in 1937, Caesars Entertainment has grown through development of new resorts, expansions and acquisitions. Caesars Entertainment's resorts operate primarily under the Caesars®, Harrah's®, Horseshoe® and Eldorado® brand names. Caesars Entertainment offers diversified amenities and one-of-a-kind destinations, with a focus on building loyalty and value with its guests through a unique combination of impeccable service, operational excellence and technology leadership. Caesars Entertainment is committed to its employees, suppliers, communities and the environment through its PEOPLE PLANET PLAY framework. 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. All statements other than statements of historical fact are forward-looking statements. 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 statements may be influenced by factors that could cause actual outcomes and results to be materially different from those projected. There are a number of risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements which are included elsewhere in this press release. These risks and uncertainties include, without limitation: (a) the effects of the COVID-19 public health emergency, including (i) the impact of the actions taken to contain the public health emergency or mitigate its impact, (ii) the direct and indirect economic effects of the public health emergency and measures to contain it (including various state governments', tribal authorities' and/or regulatory authorities' issuance of directives, mandates, orders or similar actions restricting freedom of movement and business operations, such as travel restrictions, border closures, business closures, limitations on public gatherings, quarantines and "shelter-at-home" orders, any of which may result in the closure of business operations) and (iii) changes and instability in global, national and regional economic activity and financial market activity as a result of the COVID-19 public health emergency and the impact on consumer discretionary spending and travel, all of which are highly uncertain and cannot be predicted with confidence; (b) legislative, regulatory and economic developments, including regulatory approval of the sale of Caesars Southern Indiana; (c) the fact that the transactions contemplated by the transaction agreements for the sale of Caesars Southern Indiana may not be completed on the terms contemplated or at all, including because they are conditioned upon the receipt of regulatory approvals, and other closing conditions, and the potential adverse reactions or changes to business, customer, management or employee relationships, including those resulting from the announcement or completion of the contemplated transactions; the possibility that the anticipated operating results and other benefits of the contemplated transactions are not realized when expected or at all; and (d) additional factors discussed in the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in CZR's respective most recent Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q as filed with the Securities and Exchange Commission. Other unknown or unpredictable factors may also cause actual results to differ materially from those projected by the forward-looking statements.
In light of these and other risks, uncertainties and assumptions, the forward-looking events discussed in this press release might not occur. These forward-looking statements speak only as of the date of this press release, even if subsequently made available on the websites of Caesars or otherwise, and Caesars does not intend to update publicly any forward-looking statement to reflect events or circumstances that occur after the date on which the statement is made, except as may be required by law.
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SOURCE Caesars Entertainment, Inc.
FAQ
What is the sale price for Caesars Southern Indiana?
How will the transaction affect Caesars' payments to VICI Properties?
When is the expected closing date for the Caesars Southern Indiana sale?
What partnership will continue after the sale of Caesars Southern Indiana?
