A few big breaking news items broke Monday that deserve a pause from the regular conversation here to contemplate. Both news items are interesting changes in the casino landscape. One impacts those who visit casinos nationally, while one may seem a bit more focused in scope initially (and certainly hits close to home for me as a New Englander) but could itself also have broader impacts.
Caesars Entertainment to Merge with Eldorado Resorts
The bigger news is one that’s been seen as coming for a bit now – Eldorado Resorts and Caesars Entertainment has announced a merger. The combined company will own a metric ton of casinos, which to the average casino goer means more properties using the Caesars Rewards program (which they announced, like Caesars Entertainment’s name, is the direction they expect to go) and chances to earn and redeem comps at properties throughout the country.
There could be some shake-ups in large markets like Las Vegas and Atlantic City. They hinted they plan on pruning their casino line-up in Las Vegas, for instance, and extremely vital and generally accurate Vital Vegas has noted there’s been consideration of removing Planet Hollywood (not a core brand, and at one end of their continuous strips on the Vegas strip) and Rio (long rumored) from their portfolio to reduce their exposure there while also freeing up cash by reducing the cost of the purchase.
In Atlantic City, Eldorado owns Tropicana, having bought the company last year (coincidentally or perhaps not, Carl Icahn and Tony Rodio, who were part of the Caesars acquisition push, were behind the Tropicana sale last year to Eldorado too). So that’d give them four casinos there, which until a few years ago Caesars had until they closed Showboat in an effort to streamline operations there.
Caesars’ casinos there, particularly Bally’s and Caesars, have been considered the ones who have taken the biggest hit since the opening of Hard Rock and Ocean last year, and Showboat is considering bringing a casino back, which would add even more competition. Both Harrah’s and Tropicana have performed well there despite the new competition, so a merger would still be a formidable presence. And Tropicana management’s ability to renovate and revive Tropicana could be carried into efforts at Bally’s/Caesars.
The company would also have larger concentrations in such markets as Reno and Laughlin, so it wouldn’t be surprising to learn of other divestments as the merger completion approaches.
The merger is expected to take until 2020 to complete due to regulatory review and approval, which gets complicated when casinos are involved. This will be an interesting story to watch, as it could open up some new comp opportunities for those who haven’t been to markets being served by the combined company, or it could lead to a pullback as part of their cost savings. The Vegas strip opportunities may shift if they have less hotels to offer rooms as well. We shall see where things go as they develop.
Mohegan Gaming & Entertainment Rumored to Operate Virgin Hotels Las Vegas
Vital Vegas was also quick to share the rumor (nothing official has been declared yet, but they’re generally very reliable with the news they share) that Mohegan Gaming & Entertainment will be managing the casino at Virgin Hotels Las Vegas when it opens in 2020. This would be the first property the Mohegan team would be managing in Las Vegas.
Aside from the flagship Mohegan Sun property in my home state of Connecticut, they’ve managed in recent years Resorts Casino in Atlantic City, as well as Ilani in Washington State. They also own Mohegan Sun Pocono in Pennsylvania.
The rumor comes on the heels of the announcement that they would be managing the Niagara Gaming Bundle in Canada. They’ve proven to be a solid operator of their home properties and the ones they’ve taken over, so it’s not surprising to see these new announcements, but the speed and level of growth is what’s interesting here. The Mohegan team has been actively interested in growing their operations, and these deals will certainly fit the bill.
For those of us who play at Mohegan Sun and other casinos they own or operate, the interesting question will come when we see what they offer to woo people to visit. As a regular visitor and player of their flagship CT casino, they’ve sent some pretty aggressive enticements to visit their Atlantic City casino periodically and it’s led me to spend some time there as a result.
I imagine similar opportunities could pop up when Virgin Hotels opens in Las Vegas, presuming this proves accurate. This could be great for Mohegan Sun players, and a good way to compete with Foxwoods’ deal with Caesars Entertainment, which now includes the ability to get a free room to visit Las Vegas if you’re a higher card tier. (That offers ends in December, so it will be interesting to see what’s available after that given the merger.)
Do you find the latest casino news and rumors exciting? Concerning? Share your thoughts in the comments!