Caesars Sale Would Impact Indiana Casino Industry

Posted on June 7, 2024

Some recent moves surrounding Caesars Entertainment have left some wondering if the company could potentially be acquired by another operator.

Currently, Caesars owns three casinos in the Hoosier State:

  • Harrah’s Hoosier Park Racing & Casino in Anderson
  • Horseshoe Indianapolis in Shelbyville
  • Horseshoe Hammond in Hammond

If a sale were to happen, it would certainly shake up Indiana’s casino market.

A bad start for Caesars in 2024

There is no official word on a potential sale. And no company has publicly stated a desire to buy Caesars Entertainment. But there are some signs that point to the possibility.

For starters, the company did not have a great start to the year.

Caesars’ net revenue was $2.7 billion in the first three months of this year. That was below 2023’s first-quarter mark of $2.8 billion. Additionally, 2024 first-quarter GAAP net losses totaled $158 million, which was $22 million more than the same quarter a year ago. The company’s same-store adjusted EBITDA came in at $853 million, a $94 million drop from 2023’s first quarter.

CEO Tom Reeg put it plainly:

“This was kind of a kitchen sink-type quarter for us. Everything that could go wrong did for us.”

Caesars President and Chief Operating Officer Anthony Carano said the down quarter was a result of a few different things, including “inclement winter weather” in regional segments and low table hold in Las Vegas.

Investor’s action raises some eyebrows

According to Bloomberg, billionaire investor Carl Icahn “amassed a sizeable position” in Caesars. There are no specifics available publicly as to just how much, but it was enough for the company’s stock to rise to its highest mark in more than a year and a half.

Caesars stock is still down 25% so far this year.

It’s worth noting that Icahn told CNBC that he supports Caesars’ management. He also said he doesn’t have any plans to lead a takeover attempt.

Icahn is no stranger to change at Caesars, though. In 2019, Eldorado Resorts bought Caesars for $17.3 billion. The two companies combined and kept the Caesars branding.

Icahn had a hand in the move. Before the sale, Caesars appointed three new board members, all of whom were backed by Icahn. The company even said that if the new chief executive wasn’t favored by the new members within 45 days, Icahn could add a fourth member to the board.

Two companies could be interested in Caesars

There are no apparent front-runners to buy Caesars if it came up for sale.

Penn Entertainment owns two properties in the state (Ameristar Casino Hotel East Chicago and Hollywood Casino Lawrenceburg). But there are rumblings that it could soon be up for sale. Earnings + More noted that Boyd Gaming and Hard Rock could be potential buyers.

Either of them could be interested in purchasing Caesars.

If Boyd Gaming bought Caesars, acquiring its three Indiana casinos, it would own five casinos in the Hoosier Sate. Gaming regulators would probably scoff at that and force Boyd to sell at least one of its properties.

When Eldorado took over Caesars, Indiana regulators required that Eldorado sell three of its Indiana properties. The group would have owned five of the state’s 13 casinos. The Indiana Gaming Commision said Eldorado would have an “undo economic concentration.”

There’s a chance that Hard Rock might want to acquire Caesars. If that happened, it would have four casinos in the state and might be required to sell at least one of them.

Photo by AP Photo, file/John Locher
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Adam Hensley

Adam Hensley is a journalist from Des Moines, Iowa, who currently works for the USA Today Network. His byline has appeared in the Associated Press, Sports Illustrated and sites within the USA Today Network. Hensley graduated from the University of Iowa in 2019 and spent his college career working for the Daily Iowan’s sports department, both as an editor and reporter.

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