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If the new wave of talks in the casino city of Las Vegas are true, the city could witness the tie-up of two biggies in the casino industry: the merger between Caesars and MGM. If it happens, we will have a new $20-plus-billion gambling giant.
A report in New York Post cites unnamed sources who claim to be familiar with the ongoing discussion between the two companies.
It must be kept in mind that Caesars has recently declined a takeover bid from businessman Tilman Fertitta, who owns the Golden Nugget hotel and casino chain.
According to NY Post sources, MGM has tapped investment bank Morgan Stanley and law firm Weil, Gotshal & Manges to study a potential merger with Caesars. However, there is still no offer on the table, sources have pointed out.
People familiar with the matter have also revealed that activist hedge funds, which collectively own about a quarter of Caesars, have been pushing for a MGM tie-up for some time now. A merger of the two operators would create a behemoth gambling giant with a market capitalization of more than $21 billion. According to the NY Post’s sources, Canyon Partners, which owns shares in both Caesars and MGM, is among the hedge funds supporting a deal between the two companies.
If the merger takes place, the new entity will own almost half of all Las Vegas and Atlantic City hotel rooms.
Source: Latest News on European Gaming Media Network
