Caesars Entertainment Corporation has reached an agreement with VICI Properties to sell Harrah’s Las Vegas for $1.14 billion.
In November this year, Caesars had announced that it would acquire Centaur Holdings, LLC for $1.7 billion in cash. Centaur owns and operates Hoosier Park Racing and casinos in Anderson; casino in Shelbyville, Indiana and; the Indiana Grand Racing. Harrah’s Las Vegas sale is seen as a means to fund the Centaur deal.
Caesars will continue to operate Harrah’s Las Vegas, having agreed to a 15-year lease contract for the property wherein they pay an annual rent of $87.4 million to VICI. The lease will increase as the years go by. After the lease term is over, the Caesars have an extension option – to stretch the lease for up to 20 years in four five-year extensions.
Apart from the deal, Caesars acquire a 18.4-acre plot next to Harrah’s from VICI which is expected to be used for building of a 300,000 square foot convention center. It is expected feature the largest column-free ballroom in the US and to be equipped with latest technology.
The President and Chief Executive Officer of Caesars Entertainment Mark Frissora said in his statement that the deal would allow them to acquire Centaur and develop the convention center without having to increase leverage. He believed that the development would create value and provide benefits to the patrons. He added that the deal demonstrates the group's commitment to pursue growth opportunities while maintaining financial discipline.
The Caesars Entertainment Corporation, a diversified casino-entertainment provider, also owns the Rio just off the Strip, which is known to be the home of the World Series of Poker. Over the years, Caesars group has grown through the development of new resorts, expansions and acquisitions. The group has 47 casinos in 13 U.S. states and five other countries.