Caesars Palace Las Vegas Hotel and Casino is located on the Las Vegas Strip in Las Vegas, Nevada.
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Fertitta Entertainment, led by Tilman Fertitta, is actively pursuing acquisition negotiations. caesars entertainmentA person close to the situation said.
Given Caesars’ heavy debt, the current deal terms are $32 per share, giving the company a stock value of $6.5 billion and an enterprise value of $31.5 billion, according to sources familiar with the matter.
Even if a deal is reached, a final decision would not be made in early April, with completion expected in 2027. Negotiations are taking place within a 45-day exclusivity period, sources said.
The talks will take place this weekend at Fertitta’s headquarters, the Post Oak Hotel in Houston.
Fertitta resigned as CEO of the company, which includes Landry’s, the Houston Rockets and the Golden Nugget Casino in Las Vegas, in order to meet ethics requirements when he becomes U.S. ambassador to Italy in 2025.
“As a matter of policy, we do not comment on market rumors or speculation,” Caesars said in a statement. Fertitta did not respond to CNBC’s request for comment.
On Wednesday, the Wall Street Journal reported that billionaire Carl Icahn had bid $33 per share, outpacing Fertitta’s bid of $34 per share.
People on both sides of the negotiations told CNBC they suspect Mr. Icahn is trying to inflate the deal price to increase the value of his Caesars stock. Mr. Icahn owns 1.2% of the company’s outstanding shares, according to FactSet, but one person said his total holdings in Caesars, including derivatives, are about 18 million shares.
A representative for Mr. Icahn declined to comment.
Carl Icahn speaks at Delivering Alpha in New York on September 13, 2016.
David A. Grogan | CNBC
Mr. Icahn is genuinely interested in buying Caesars and made his first friendly bid in January, offering $28.50 a share and guaranteeing the current management team would stay on, according to people familiar with the matter. Mr. Icahn’s current offer is $33 per share, subject to due diligence if Mr. Fertitta resigns, the people said.
People familiar with the matter told CNBC that Mr. Icahn is interested in partnering with a major digital gaming company, potentially merging Caesars’ digital gambling business with that of Caesars.
Mr. Fertitta then made a counter-offer to Caesars, securing exclusive negotiating rights and effectively turning down Mr. Icahn’s offer.
Mr. Icahn increased his position in Caesars in 2024, and the casino stock soared 11% to close at $36 on May 31, 2024. He also appointed two directors to the company’s board of directors.
Caesars stock has been under pressure since October 2021, when it hit a post-pandemic high of $119 after Eldorado acquired Caesars in July 2020 for about $18 billion.
“The math is too good to ignore,” said a person close to the situation, citing a subdued stock price and a casino business that boasts about $1 billion in free cash flow and $4 billion in EBITDA annually.
Talks continue this weekend, but there is no sign that a deal is imminent, and any agreement would certainly be subject to scrutiny from regulators and shareholders. Investors are skeptical that Caesars’ digital businesses, which include sports betting and online casino games, are currently generating profits for Caesars.
Kalshi, Polymarket, robin hoodCrypto.com and others are also seen as a competitive threat to sportsbooks.
Caesars CEO Tom League previously said he would consider spinning off the company’s digital business, but recently said the valuations of competing sportsbooks made it less attractive.
FanDuel’s parent flutter ‘s stock price has plunged more than 60% in the past six months. draft kings The stock price has fallen more than 40%.
There are also questions about how regulators will take into account Tilman Fertitta’s personal holdings in other gambling companies.
he is the largest shareholder of Wynn ResortsIt owns more than 12% of the outstanding shares, according to FactSet. Fertitta has more than 4 million call options listed on his stock, according to SEC filings since early 2026.
He also became a major shareholder in the sports betting company after selling Golden Nugget Online Gaming to DraftKings.
Visi, The gaming REIT, which was created out of Caesars’ bankruptcy in 2017, is the owner of Caesars Palace and Harrah’s on the Las Vegas Strip, as well as about 20 other area properties. VICI has the opportunity to consider an acquisition, but contrary to published reports, it does not have a vote on who buys Caesars.
VICI was involved in financing Eldorado’s acquisition of Caesars.
“We have a productive and collaborative history of working with our partners to improve our business,” VICI CEO Ed Pitoniak told CNBC.
Disclosure: CNBC and Kalsi have a commercial relationship that includes customer acquisition and minority ownership.
