The acquisition this week of Caesars Entertainment Corporation (CEC) by Reno-based Eldorado Resorts is one of those industry-changing events that’s going to have far-reaching impact across the poker and gambling scenes. The effects will necessarily spill into the online poker world, since the World Series of Poker and its online, WSOP.com-related offerings, are owned by Caesars Interactive Entertainment (CIE), a division of CEC that’s part and parcel of the larger deal.
Of course, the big headlines are the creation through this merger/acquisition of the US’s largest casino-entertainment conglomerate, which will retain the Caesars corporate name and its greater brand recognition moving forward. The deal, valued at something around $18 billion, is a cash-and-shares combo package that will spread out Caesars existing and rather crippling debt load over a larger shareholder base, while leaving Eldorado in ultimate control of the operation, with 51% of the combined company’s shares to 49% per Caesars.
In exchange for the larger Caesars giving up operational control, they agreed to a sales price of $12.75 per share. That’s below industry estimates of about $14/share, but better than Eldorado’s initial offer of $12/share that was nixed about a month ago. The secret behind this give-and-take is the 28% share in Caesars that venture capitalist Carl Icahn has built up over the paast couple of years. Icahn, a veteran of the gambling-industry scene, saw that an out-of-bankruptcy but still debt-riddled CEC was ripe for sale, if not even breakup, as has been rumored in recent years as well. When Icahn got a price from Eldorado that he could accept, the deal got done.
Now, on to the poker stuff. Despite the World Series of Poker being one of Caesars shinier, most-profitable assets, it still shrinks in comparison to the overall deal: The newly merged company will have 60 separate casino properties in 16 states and five other countries besides the US. Yet the WSOP is a Las Vegas icon, and it needs to stay in the desert city.
Eldorado already owned nearly 20 properties, but exactly zero of them are in Vegas. Eldorado’s crown jewel is probably the Silver Legacy in downtown Reno, but that property is probably Reno’s third-nicest casino, does not have near enough convention space to handle the WSOP, and is just unsuitable for such a series in several ways.
That leaves the WSOP needing to stay at an existing Caesars property for the time being. Long-range plans for the WSOP have been rumored to include a move to the under-construction Caesars Convention Center, though that property won’t open until some time in 2020 and isn’t likely to have the ample and convenient parking that’s always been one of the Rio Convention Center’s secret benefits.
Poker players who are veterans of the WSOP also understand that there’s a difference between the Rio Convention Center, the drab, beige-colored building that houses almost all of the WSOP, and the Rio All-Suite Hotel & Casino itself. The two are connected but separated by something like a quarter-mile hike, and the casino property has always been high on the list of properties Caesars has been rumored to be trying to dump for several years now.
These days the actual casino part of the property is a bit indifferent and long in the tooth, if I have to be honest about it. The suspended tram cart of Carnival-dressed dancers showering bead necklaces down upon gamblers at the slots appears to be a thing of the past, and the whole Rio/Brazil party theme has been scaled way back. So too have the number of slot positions; an exact count of what the Rio offers for slots won’t be found here, but I can tell that a hundred or more machines have been removed over the past couple of years. Down around the casino floor’s eastern arc, there’s a lot of roomy floor space not exactly stuffed with slots, as it once was.
That’s indicative of the Rio’s growing age and perhaps not-quite-cutting edge personality these days, though with Caesars’ old debt issues, it’s easy to see why that was the case. It’s still the WSOP’s home, and this prognosticator thinks it’s likely to stay that way at least through 2020.
Moving on. One of the elements in the acquisition was Eldorado’s statement that a “significant corporate presence” will remain in Las Vegas. That’s especially true for the WSOP. One can sign up in Reno — I believe at Harrah’s Reno or Circus Circus Reno — for an online WSOP.com, and there are occasional Circuit stops held both in Reno and at Lake Tahoe, about an hour away. There is a chance some of the corporate stuff dealing with the online-poker platform could end up in Reno, but the guts of the WSOP “dot-com” operation is still likely to be among the stuff staying in Vegas, due to its entwining with the live summer WSOP.
It’ll be interesting to see how this deal plays out in the coming years. Like a lot of other Caesars endeavors, the WSOP has been starved for a little bit of TLC. Perhaps, with more financial stability and some new management faces at the very top, some rosier days are ahead.
