Eldorado/Caesars plan $8.2 billion of loans, bonds for combination

By Sara Rosenberg

New York, June 24 – Eldorado Resorts Inc. expects to get $4 billion of credit facilities and issue $1.8 billion of senior notes due 2028 to help fund its acquisition of Caesars Entertainment Corp., according to an 8-K filed with the Securities and Exchange Commission on Monday.

In addition, Caesars Resorts Collection plans on getting a $2.4 billion term loan B due 2027 to help fund the transaction.

The Eldorado credit facilities consist of a $1 billion revolver and a $3 billion term loan B due 2027.

J.P. Morgan Securities LLC, Credit Suisse Securities (USA) LLC and Macquarie Capital (USA) Inc. provided the Eldorado debt commitment.

With this transaction, Caesars’ existing $1 billion revolver, $4.6 billion term loan B due 2024 and $1.7 billion senior notes due 2025 are expected to remain in place.

Other funds for the transaction will come from $3.2 billion from VICI Properties to fund its acquisition of land and real estate assets associated with Harrah’s New Orleans, Harrah’s Laughlin and Harrah’s Atlantic City and modify certain provisions of the existing Caesars lease agreements, $385 million from announced asset sales proceeds and cash on hand.

Under the agreement, Eldorado will acquire all of the outstanding shares of Caesars for a total value of $12.75 per share, consisting of $8.40 per share in cash consideration and 0.0899 of a share of Eldorado common stock for each Caesars share of common stock.

The total consideration is about $17.3 billion, comprised of $7.2 billion in cash, around 77 million Eldorado common shares and the assumption of Caesars’ outstanding net debt, excluding face value of the existing convertible note.

Post transaction, Eldorado shareholders will hold about 51% of the combined company and Caesars shareholders will own about 49%.

Closing is expected in the first half of 2020, subject to approval of the stockholders of Eldorado and Caesars, the approval of applicable gaming authorities, the expiration of the applicable Hart-Scott-Rodino waiting period and other customary conditions.

Eldorado is a Reno, Nev.-based gaming company. Caesars is a Las Vegas-based gaming and entertainment company. Upon completion of the transaction the combined company will retain the Caesars name and be based in Reno.

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