Twin River Worldwide Holdings to Acquire Three Casinos From Eldorado and Caesars
Twin River Worldwide Holdings, Inc. (NYSE: TRWH) ("Twin River" or the "Company") announced that it has entered into an agreement with Eldorado Resorts, Inc. ("Eldorado") to acquire Eldorado Shreveport Resort and Casino ("Shreveport") in Shreveport, Louisiana and the Mont Bleu Resort Casino & Spa ("Mont Bleu") in Lake Tahoe, Nevada for an aggregate purchase price of $155 million. Separately, the Company has entered into an agreement with Caesars Entertainment Corporation ("Caesars") and Vici Properties Inc. ("Vici") to acquire Bally's Atlantic City Hotel & Casino ("Bally's") for $25 million in cash. The transactions are expected to be immediately accretive to earnings. The agreed upon purchase prices are subject to customary post-closing adjustments.
Together, these acquisitions significantly expand Twin River's footprint into three additional U.S. states. The three properties combined contain 3,318 slots, 2,092 hotel rooms and 176 tables, in addition to 6,000 square feet of convention space at the Eldorado Shreveport Resort and Casino.
"These acquisitions represent a unique opportunity to continue executing on our expansion and diversification strategy at attractive valuation multiples," commented George Papanier, President and Chief Executive Officer of Twin River. "We see significant opportunities to create cross marketing connections for customers at multiple Twin River locations, and we look forward to applying our proven operating and integration approach to drive incremental revenues and cash flows."
Soo Kim, Chairman of the Twin River Board of Directors, stated, "This is a great deal for Twin River, and diversifies our business across eight states. It reaffirms our commitment to employees, customers and the communities in which we operate that Twin River will be stronger than ever."
The Company is acquiring Shreveport's operations and real estate and Mont Bleu's operations. It has entered into an amended agreement with Mont Bleu's landlord, including extension of the lease term to the end of 2035.
The Company's proposed acquisition of these properties is subject to FTC approval and is conditioned upon consummation of the merger of Eldorado and Caesars.
The purchase price for these two properties on a combined basis represents an implied trailing twelve-month proforma earnings before interest, taxes, depreciation and amortization ("EBITDA") multiple of approximately 4.1x, excluding any potential impact from cost and revenue synergies.
Twin River's agreement with Caesars and Vici is structured as an asset purchase, covering certain assets of Bally's and the property on which they are operated. The Company will also acquire the license to build out a sports book and launch online sports betting and I-Gaming.
The Bally's purchase price represents an implied trailing twelve-month EBITDA multiple of approximately 2.1x, excluding any potential impact from cost and revenue synergies.
Shreveport is located in Shreveport, Louisiana. The property consists of approximately 1,400 slots, 54 tables, 403 hotel rooms and 6,000 sf of convention space. Mont Bleu is located in Lake Tahoe, Nevada and features approximately 418 slots, 17 tables and 438 hotel rooms. Bally's is located in Atlantic City, New Jersey, with a prominent location in the center of the Atlantic City boardwalk. The property includes 1,500 slots, 105 tables and 1,251 hotel rooms.
"Despite the uncertainties presented by the current health crisis, we continue to execute our strategy to position Twin River for long-term growth and profitability," Papanier added. "Completion of these transactions will meaningfully enhance our financial profile, while strengthening our presence in a number of key geographic markets."
The Company plans to fund the transactions with a combination of cash on hand and the expected upsizing of the Company's existing credit facility.
The Shreveport and Mont Bleu transaction is expected to close in the first half of 2021 and the Bally's transaction is expected to close in late 2020 or early 2021, subject to receipt of FTC and gaming regulatory approvals, financing and other customary closing conditions.
Citizens Capital Markets, Inc. and Jones Day were Twin River's financial and legal advisors.