Caesars Entertainment is allowed to establish Caesars Growth Partners
The world’s largest land-based gaming firm, Caesars Entertainment Corporation, has had its plan to establish the Caesars Growth Partners LLC venture approved by the Nevada Gaming Commission.
Las Vegas-based Caesars Entertainment revealed in April that majority shareholders Apollo Management LP and TPG Capital LP each intend to contribute $250 million towards the new enterprise, which is to be headed by Mitch Garber, Chief Executive Officer for Caesars Interactive Entertainment Incorporated.
The trio of companies will then hold a 70% share in Caesars Growth Partners and control of the Caesars Interactive Entertainment subsidiary, Planet Hollywood Resort and Casino in Las Vegas, interests in a casino under development in Baltimore and a financial stake in the management fee stream for both properties.
Finally, Caesars Growth Partners is also due to receive approximately $1.1bn in senior notes issued by Caesars Entertainment Operating Company Incorporated and held by a subsidiary in exchange for non-voting membership interests.
Michael Cohen, deputy general counsel for Caesars Entertainment, stated that the establishment of Caesars Growth Partners was more of a transaction to increase financing and growth rather than a traditional spin-off with the parent able to re-absorb the businesses after five years.
“This is a unique transaction where Caesars Entertainment is selling assets yet continuing to manage and benefit from them,” said Cohen.