Eldorado Resorts and GLPI complete Tropicana Entertainment acquisition

Eldorado Resorts and GLPI complete Tropicana Entertainment acquisition

Tuesday, October 2, 2018 Posted by News Team
Deal sees Eldorado acquire operating assets of seven casinos in six states

Eldorado Resorts and Gaming and Leisure Properties (GLPI) have completed the $1.85bn acquisition of Tropicana Entertainment from Icahn Enterprises, the holding company established by billionaire investor Carl Icahn. 

The deal, first agreed in April this year, sees Eldorado take over the operating assets of seven casinos in six states. This includes the Tropicana Laughlin Hotel and Casino and the MontBleu Casino Resort & Spa in South Lake Tahoe, Nevada as well as the Tropicana Evansville (Indiana); Trop Casino Greenville (Mississippi) and Belle of Baton Rouge Casino & Hotel (Louisiana). 

It also takes charge of Missouri’s Lumière Place and the Tropicana Hotel and Casino in Atlantic City, New Jersey.

Together these properties include 7,900 slot machines, 265 tables games and 5,400 hotel rooms, alongside a range of dining, retail and entertainment facilities. The company’s total property portfolio now features more than 27,500 slots and video lottery terminals, over 800 table games, more than 12,500 hotel rooms and almost 20,000 employees. 

Eldorado has also acquired the underlying real estate for the MontBlue Casino and Lumière Place. GLPI has acquired the real estate of the other five venues, and awarded Eldorado a 15-year master lease for all properties. 

“Our acquisition of Tropicana marks a continuation of Eldorado’s successful history of rapid growth through strategic, accretive acquisitions,” Eldorado chairman and chief executive Gary Carano commented. “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.”

The operator’s president and chief financial officer Tom Reeg noted that the deal allowed Tropicana to add “financial and geographic diversity” to its operating base. 

He added that the company had identified more than $40m of synergies that it expected to realise over the coming year. 

The seller, Carl Icahn of Icahn Enterprises, said that when his company had first acquired an interest in Tropicana in 2008, the business was bankrupt and in desperate need of new leadership. 

"At that time, we identified this undervalued asset as being a perfect situation to deploy our modus operandi, by which we seek to acquire undervalued assets, nurture, guide and improve their condition and operations, and to ultimately greatly enhance value for all shareholders,” he explained.

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