Did Caesars Sell Bally's Atlantic City as a Leaseback Deal?

This question isn't about Vegas, but Atlantic City. I read that Caesars sold Bally's, one of its three properties in A.C. Is this one of those deals where they sell a property, then lease it? It doesn't sound like it from what I read.

No, it was a straight-up sale -- with one slight wrinkle.

Although Twin River Worldwide Holdings, the buyer, sounds like the name of a real estate investment trust, it's actually a casino company and not a REIT. It owns two eponymous casinos in Rhode Island, as well as the Hard Rock Hotel & Casino in Biloxi. It also owns Dover Downs in Delaware, Isle of Capri Casino Kansas City, Lady Luck Casino Vicksburg, and three gaming properties in Colorado (Mardi Gras, Golden Gulch, and Golden Gates casinos). Pending acquisitions include Eldorado Shreveport and Montbleu in Lake Tahoe.

Caesars is in the process of being taken over by Eldorado Resorts. The merger would have given the combined companies four casinos in Atlantic City, which New Jersey regulators would almost certainly have deemed an undue concentration of ownership. (The other three are Caesars, Harrah’s, and Tropicana.) Bally’s has been struggling for market share, is explicitly positioned as a grind joint, and doesn’t gross nearly as much as its brethren. It was the obvious candidate for a spinoff.

What was surprising was the price: a mere $25 million. Given that the Atlantic City market had been on the comeback, at least before the shutdown (the casinos there are still closed, with no reopening date in sight), this was a paltry amount, a coup for Twin River and something of an embarrassment to Caesars. The price was depressed by the retention of the Bally’s Wild Wild West annex, which will be rebranded. Still, Twin River is now a player on the Boardwalk and, not having had to carry a vacant casino through the coronavirus shutdown, starts the reopening with a clean slate.

A growing power in the casino industry, Twin River is not to be underestimated.

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WAHeckelny Jun-20-2020

Caesars Takeover

Do you mean the entire Caesars Empire or just the Caesars casino in AC is in the process of being taken over by Eldorado Resorts  ??

Michael Jun-20-2020

Caesars

All of Caesars Entertainment, worldwide, is being taken over by Eldorado.

jay Jun-20-2020

Eldorado

In addition Eldorado is consolidating head offices in Reno. The current Eldorado ho is 1/3 of the size of Caesars managing more properties. In addition to those who will not want to make the move to Reno, my prediction is that there will be a lot of Caesars Mgmt types looking for jobs. 

Eldorado also has a rep for lowballing comps.

rokgpsman Jun-20-2020

Downfall

The downward turn for the Caesars Palace casino resort was back when Gary Loveman CEO of Harrah's decided to take on a gargantuan amount of debt to buy Caesars Palace, then cheapen it by implementation of many Harrah's policies. Harrah's even changed it's corporate name to Caesars Entertainment to take advantage of the legendary Caesars Palace brand. But it wasn't long before the Harrah's way of running things was seen as a big negative by longterm Caesars customers. Harrah's hurt the iconic Caesars Palace resort and in the process Harrah's became very over-extended financially, resulting in the ouster of Loveman and the collapse of Harrah's into bankruptcy.

Question of the Day - 20 June 2020

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