Eldorado Resorts has announced it will purchase seven of Tropicana Entertainment’s nine casinos for $1.85bn in a partnership with Gaming and Leisure Properties Inc.
The agreement, which excludes Tropicana’s MontBleu and Aruba casinos, will see the six state portfolio acquired through a majority investment of $1.21bn from Gaming and Leisure.
The company will then lease the properties exclusively to Eldorado in return for the remaining $640m of the purchase price.
“The acquisition of seven Tropicana Entertainment properties will allow Eldorado to enter two new gaming jurisdictions and deliver additional financial and geographic diversity to our operating base,” said Eldorado CEO Gary Carano. “We have identified $40m of synergies that we expect to realise in the first year of our ownership.”
The casinos, in Nevada, Indiana, Louisiana, Mississippi, Missouri and New Jersey, operate approximately 7,900 slot machines, 265 table games and 5,400 hotel rooms.
The purchase will increase Eldorados totals to 26,800 slots and VLTs, over 800 table games and more than 12,500 rooms, with the latest additions requiring no significant investment to increase profitability.
“Overall, the Tropicana portfolio is in good shape,” said Carano. “We have no immediate significant capex plans for the properties.”
The deal continues an ongoing programme of property investment for Eldorado, which saw the Reno-based company acquire Isle of Capri Casinos in May for $1.1bn, as well as 50 percent of the Grand Victoria Casino in Elgin, Illinois from MGM Resorts in a $327.5m cash purchase on 16 April.