Caesars Fertitta Merger Wins Shareholder Approval
Caesars shareholders approved the $17.6 billion Fertitta merger, but an FTC antitrust review still stands between the deal and closing.
Caesars Entertainment shareholders approved the Caesars Fertitta merger Tuesday, backing Tilman Fertitta's $17.6 billion buyout. About 65% of eligible shares supported the deal, according to CDC Gaming, but a Federal Trade Commission antitrust review is still pending. The merger would take one of Nevada's biggest casino operators private.
- Shareholders approved the Caesars Fertitta merger with about 65.4%, or 133,313,001, of eligible shares, per CDC Gaming.
- Caesars agreed to pay shareholders $31 per share; the total deal includes $11.9 billion in assumed debt.
- The FTC issued a second information request on September 14, extending the antitrust review by 30 days.
- Caesars stock closed Wednesday at $29.61, below the agreed buyout price.
- Caesars runs more than 50 casinos in 19 states; Fertitta owns Golden Nugget and a 12.3% stake in Wynn Resorts.
- Caesars agreed to $31 a share, a 49% premium over its stock price when Fertitta first made the offer in February.
What did Caesars shareholders just approve?
Caesars Entertainment shareholders voted Tuesday to approve the Caesars Fertitta merger, a $17.6 billion deal that would take the company private. The vote happened at a special meeting at the Eldorado Resort and Casino in Reno, according to iGaming Business.
CDC Gaming reports that about 65.4% of eligible shares, or 133,313,001, backed the deal. That easily cleared the majority needed from the 203,780,124 shares outstanding as of the August 21 record date.
Shareholders also approved a separate, non-binding vote on executive compensation tied to the merger. Caesars said in its SEC filing that the adjournment proposal became unnecessary once enough votes came in, since there was no need to buy extra time.
The deal followed months of competing bids between Fertitta and Carl Icahn, who once controlled a large stake in Caesars and helped push through its 2020 merger with Eldorado Resorts. As part of the current agreement, Eldorado's Carano family will keep its equity stake, and current management stays in place.
Why does the FTC review still matter?
Shareholder approval is only one step. The Federal Trade Commission is still reviewing the deal for antitrust concerns, and that process is not finished.
iGaming Business reports the FTC issued a second request for information on September 14, which extends the Hart-Scott-Rodino review by 30 days once both companies comply. Neither Caesars nor the FTC has disclosed exactly what the commission wants to know.
Caesars and Fertitta's Golden Nugget brand compete directly in six markets, including Las Vegas, Lake Tahoe and Laughlin. Given that overlap, regulators may require one or both companies to sell off properties before signing off on the deal.
There is recent precedent for that kind of order. When the FTC reviewed the 2020 Caesars-Eldorado merger, it required Eldorado to divest casinos in Lake Tahoe, Bossier City and Kansas City, and the companies sold off five more properties around that same time.
What else has to happen before the deal closes?
Beyond antitrust clearance, Fertitta still needs to line up financing. According to iGaming Business, the company agreed to a $6.6 billion package split between a $2 billion revolving credit facility and $4.6 billion in term and bridge loans.
Fertitta told Nevada regulators back in July it was waiting for friendlier interest rates before raising that money. Rates have moved since then, with the Federal Reserve raising them this month for the first time in three years, and at least one more hike expected before year's end.
Caesars disclosed a separate wrinkle too: a shareholder sent a demand letter in September questioning how the company disclosed its legal counsel on the deal. Caesars called the claims meritless but handed over extra details anyway to avoid delays, noting that its law firm, Latham & Watkins, also represents Fertitta personally on unrelated matters.
CDC Gaming reports that Caesars expects the deal to close by June 26, or Fertitta will owe a daily penalty of $0.007150 per share for each day the closing is delayed past that date.
What does this mean for casino customers and players?
For now, nothing changes at the tables or the poker rooms. Caesars still owns and runs its properties, including its eight Las Vegas Strip casinos, four Reno casinos and three Lake Tahoe properties, while the deal works through regulatory review.
If the FTC forces property sales, some Caesars or Golden Nugget locations could change hands or branding down the road. That kind of shakeup has happened before, and past casino mergers show regulators are willing to force divestitures when markets overlap this much.
What it means for players
None of this changes anything at the poker table today. Caesars properties keep running as usual while the FTC review plays out, and any ownership changes are still months away at best. Players who track the industry should watch for divestiture news, since past casino mergers have forced sales of specific properties in overlapping markets like Lake Tahoe. If you want to sharpen your own game while the corporate paperwork sorts itself out, brush up in the free poker room or check preflop ranges in the preflop lab.
More on Lifes a Gambol: South Florida casinos guide.
Frequently asked
Has the Caesars-Fertitta merger closed?
No. Shareholders approved it, but the deal still needs Federal Trade Commission antitrust clearance and final financing before it can close, according to CDC Gaming.
How much will Caesars shareholders get paid?
Caesars agreed to pay shareholders $31 per share in cash, part of a $17.6 billion deal that also includes about $11.9 billion in existing Caesars debt.
Why is the FTC still reviewing the deal?
Caesars and Fertitta's Golden Nugget brand compete in six markets, including three in Nevada. iGaming Business reports the FTC sent a second information request in September, which could lead to required property sales.
Who is Tilman Fertitta?
Fertitta owns the Golden Nugget casino brand and holds a 12.3% stake in Wynn Resorts. His company outbid Carl Icahn earlier this year to reach the deal with Caesars.