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The massive Caesars-Eldorado merger appears to be closer to completion, as a Rhode Island casino operator also gets access to the lucrative but highly competitive Garden State online gambling market.
On Friday, Caesars Entertainment Corporation and the real estate investment trust VICI Properties announced an agreement to sell the Bally’s Atlantic City Hotel & Casino to Twin River Worldwide Holdings for about $25 million in cash. VICI will receive about $19 million, and Caesars gets $6 million.
The deal, which is subject to regulatory approval at both the state and federal levels, apparently was needed in order for New Jersey to move forward with approving the highly complex $17.3 billion Caesars-Eldorado merger that was announced in June 2019. Other states also still need to sign off on it.
Prior to the announcement, Caesars had three of the nine retail Atlantic City casinos, and the merger with Eldorado was going to give Caesars four with the addition of Tropicana Atlantic City.
Separately, Twin River announced Friday that it will also acquire two Eldorado casinos, one in Louisiana and one in Nevada, both states in which Caesars has casinos. Louisiana doesn’t have any legal form of online gambling, while Nevada has online poker and online/mobile sports betting.
Twin River, based in Rhode Island, will get Eldorado Shreveport in Louisiana and the MontBleu Resort Casino in Lake Tahoe, Nev., for $155 million in total.
Twin River is the owner-operator of a pair of casinos in Rhode Island, in addition to one in Mississippi, one in Delaware, and three casinos as well as a horse racetrack that has 13 authorized OTB licenses in Colorado. The Centennial State is expected to begin its legal sports wagering industry on May 1.
It was widely known before the pandemic that online gambling, though slow to be adopted by states, was the future of the U.S. gaming industry. With retail casinos across the country shuttered, it is generally assumed that states are going to take a look at gaming expansion in the post-COVID-19 world.
Though Twin River has greatly bolstered its portfolio of retail properties by adding 3,318 slots machines, 176 gaming tables, and 2,092 hotel rooms combined with its acquisition of the three aforementioned casinos, legal online betting is front and center with its recent business deals.
Twin River already has deals with DraftKings and FanDuel for online/mobile sports betting in Colorado. Online sports gambling isn’t legal in either Mississippi or Delaware, but it is in Rhode Island, though the market there is minuscule thanks to its population.
In a presser, Twin River said that the deal for Bally’s AC includes “the license to build out a [retail] sportsbook and launch online sports betting and [internet casino] gaming.”
Twin River will enter the New Jersey online gambling market late, but revenue is at a record level. In 2019, the state’s online casinos generated more than $480 million in revenue, while the online/mobile sportsbooks won more than $240 million from bettors.
The Bally’s property, which opened in 1979, was the worst performing in the seaside gambling town in 2019 in terms of money won from gamblers, according to state figures.
Bally’s AC won $176 million from gamblers, putting it dead last among the other nine casinos. Its gaming revenue was down 7.6% from the $190.3 million it won in 2018. However, its decrease wasn’t the worst among the casinos, as Golden Nugget and Tropicana saw greater than 10% declines in 2019.
Both the Golden Nugget and Tropicana properties had online casino gambling revenue to make up for the losses on the retail side, though. Bally’s AC did not.
Bally’s AC did report $5.5 million in sports betting win, fourth among the nine casinos. Bally’s AC opened its retail sportsbook book in July 2018, followed by online/mobile sports betting in September.