TLDR
- Caesars Entertainment (CZR) jumped 20.6% Thursday after reports it is weighing takeover offers, including one from Tilman Fertitta’s Fertitta Entertainment.
- A management-led buyout is also reportedly being considered; Caesars declined to comment.
- CZR’s enterprise value sits at ~$16B, which would make any deal one of the largest in gaming in years.
- MGM Resorts closed up 5.79% Thursday but slipped 0.6% in Friday premarket to $37.41.
- Wynn Resorts and Las Vegas Sands also gained 2.48% and 1.60% respectively on Thursday.
Caesars Entertainment (CZR) exploded 20.6% on Thursday after the Financial Times reported the casino operator is fielding takeover interest from multiple parties.
Caesars Entertainment, Inc., CZR
One named bidder is Tilman Fertitta through his Fertitta Entertainment. Fertitta has been in gaming since 2005, when he acquired the Golden Nugget Las Vegas and Laughlin properties. He later grew the brand to Atlantic City, Biloxi, and Lake Charles.
A management-led buyout is also reportedly on the table. Caesars declined to comment.
CZR runs more than 50 casinos across North America under the Caesars Palace, Harrah’s, and El Dorado brands. It also operates a sports betting app, which posted stronger results in Q4.
With its debt factored in, CZR’s enterprise value sits at roughly $16 billion. Any completed transaction would rank among the biggest gaming deals in recent memory.
The Sector Gets Pulled Along
The takeover speculation lifted the broader casino space on Thursday.
MGM Resorts (MGM) closed up 5.79% at $37.62. Wynn Resorts (WYNN) gained 2.48% and Las Vegas Sands (LVS) rose 1.60%.
By Friday premarket, the enthusiasm had faded slightly. MGM edged down 0.6% to $37.41 before the bell. With no confirmation from Caesars and a heavy debt load hanging over any deal, traders are staying cautious.
MGM’s Separate Announcement
Away from the deal talk, MGM and its BetMGM joint venture announced Thursday they will commit more than $1 million to responsible gaming initiatives tied to Problem Gambling Awareness Month.
MGM chief compliance officer Stephen Martino said: “As sports betting continues to grow so must our understanding of its impact.” BetMGM’s Rhea Loney called the campaign “an important reminder” of the company’s “year-round responsibility.”
Friday morning brings the Labor Department’s January producer price data at 8:30 a.m. ET, which investors will watch for signals on interest rate direction. The February jobs report follows on March 6.
As of Thursday’s close: CZR +20.6%, MGM +5.79%, WYNN +2.48%, LVS +1.60%.
