Eldorado Resorts to Acquire Grand Victoria Casino for $327.5 Million Cash in Accretive Transaction
16 April 2018 - 8:30PM
Business Wire
Eldorado Resorts, Inc. (NASDAQ: ERI) (“Eldorado” or the
“Company”) announced today that it entered into a definitive
agreement to acquire the Grand Victoria Casino in Elgin, Illinois
for $327.5 million in cash. Total consideration for the transaction
represents a purchase multiple of approximately 9.0x trailing
twelve months Adjusted EBITDA (for the period ended December 31,
2017) which Eldorado expects to reduce to approximately 6.0x or
less within 18 months of the transaction’s closing based on
expected operating synergies and cost savings. The Company intends
to fund the proposed transaction using cash from previously
announced asset sales, cash from ongoing operations and borrowings
under its revolving credit facility. The transaction is expected to
close in the fourth quarter of 2018, subject to regulatory
approvals and other customary closing conditions and is subject to
a customary working capital adjustment.
Gary Carano, Chairman and Chief Executive Officer of Eldorado,
commented, “This transaction represents yet another milestone for
Eldorado as we continue to opportunistically expand our regional
gaming platform through accretive acquisitions. The addition of
Grand Victoria Casino will further diversify the geographic reach
of our operations and includes excess contiguous acreage for
potential future development. Importantly, the acquisition is
consistent with our long-term strategy to enhance shareholder value
by structuring transactions that are strategically and economically
attractive and offer significant upside as we implement our proven
operating disciplines.
“Grand Victoria is one of the leading casinos in the Chicagoland
market and is extremely well maintained which will allow us, upon
closing, to focus on enhancing the guest experience and operating
results without the need to undertake capital investments. As we
work towards closing this acquisition by the end of 2018, we look
forward to welcoming the team at Grand Victoria to the Eldorado
family.”
Grand Victoria Casino, located in Elgin, Illinois, is
approximately 40 miles west of downtown Chicago along the banks of
the Fox River. The property features 1,088 slot machines, 30 table
games, a 12-table poker room and four dining options, including
Prime BurgerHouse, the award-winning Buckinghams Steakhouse &
Lounge, the Indulge Show Kitchen Buffet and the 24-hour Crave Deli.
It also offers 7,495 square feet of meeting and banquet space,
event and concert facilities, a 1,450-space parking garage, and
additional surface parking for 600 vehicles.
Tom Reeg, President and Chief Financial Officer of Eldorado,
added, “This transaction represents yet another step in our ongoing
efforts to bring additional scale to our portfolio base while
creating new opportunities for growth and value for our
shareholders. Over the last several years through our efforts with
the MTR assets, the Silver Legacy and Circus Circus in Reno, and
most recently the large Isle of Capri portfolio, we have clearly
demonstrated an ability to integrate and operate acquired casino
operations. We believe this experience will prove valuable as we
build on the work done by the team at Grand Victoria to further
enhance its financial performance. In particular, we believe there
is a significant opportunity to improve the operations at the
property which will allow us to quickly and meaningfully lower our
acquisition multiple.”
BofA Merrill Lynch is acting as exclusive financial advisor and
Milbank Tweed Hadley & McCloy LLP is acting as legal counsel to
Eldorado in connection with the proposed transaction.
About Eldorado Resorts, Inc.Eldorado Resorts is a leading
casino entertainment company that owns and operates twenty
properties in ten states, including Colorado, Florida, Iowa,
Louisiana, Mississippi, Missouri, Nevada, Ohio, Pennsylvania and
West Virginia. In aggregate, Eldorado’s properties feature
approximately 21,000 slot machines and VLTs and 600 table games,
and over 7,000 hotel rooms. For more information, please visit
www.eldoradoresorts.com.
Forward-Looking StatementsThis press release includes
“forward-looking statements” within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements include statements regarding our strategies, objectives
and plans for future development or acquisitions of properties or
operations, as well as expectations, future operating results and
other information that is not historical information. When used in
this press release, the terms or phrases such as “anticipates,”
“believes,” “projects,” “plans,” “intends,” “expects,” “might,”
“may,” “estimates,” “could,” “should,” “would,” “will likely
continue,” and variations of such words or similar expressions are
intended to identify forward-looking statements. Although our
expectations, beliefs and projections are expressed in good faith
and with what we believe is a reasonable basis, there can be no
assurance that these expectations, beliefs and projections will be
realized. There are a number of risks and uncertainties that could
cause our actual results to differ materially from those expressed
in the forward-looking statements which are included elsewhere in
this press release. Such risks, uncertainties and other important
factors include, but are not limited to: (a) our ability to obtain
required regulatory approvals (including approval from gaming
regulators and expiration of the waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976) and satisfy
or waive other closing conditions to consummate the transaction on
a timely basis; (b) the possibility that the acquisition of the
Grand Victoria does not close on the terms described herein, or at
all; (c) our ability to promptly and effectively implement our
operating strategies and integrate the business of Eldorado and the
Grand Victoria to realize synergies resulting from the combined
operations; (d) our ability to fund the purchase of the Grand
Victoria with proceeds from asset sales and borrowings under our
credit facility; (e) the possibility that the business of the Grand
Victoria may suffer as a result of the announcement of the
transaction; (f) the ability to retain key employees of the Grand
Victoria; ; and (g) other risks and uncertainties described in our
reports on Form 10-K, Form 10-Q and Form 8-K.
In light of these and other risks, uncertainties and
assumptions, the forward-looking events discussed in this press
release might not occur. These forward-looking statements speak
only as of the date of this press release, even if subsequently
made available on our website or otherwise, and we do not intend to
update publicly any forward-looking statement to reflect events or
circumstances that occur after the date on which the statement is
made, except as may be required by law.
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version on businesswire.com: https://www.businesswire.com/news/home/20180416005399/en/
Eldorado Resorts, Inc.Thomas Reeg,
775-328-0112Presidentinvestorrelations@eldoradoresorts.comorJCIRJoseph
N. Jaffoni, James Leahy, 212-835-8500eri@jcir.com
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