Eldorado wants Caesars to cut expenses at casino properties
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Eldorado Resorts will not launch a takeover bid for any Caesars Entertainment casinos unless their operating expenses are slashed.
That is the news coming from the US gambling press this week, with Eldorado CEO Tom Reeg reportedly seeking to cut $500 million from Caesars’ operating budget.
If that cannot be done, Eldorado will walk away from any potential buyout deal.
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Caesars has already chopped around $40 million from its wage bill by closing redundant and vacant positions at the executive level.
The firm’s corporate expenses still exceed $332 million, so there will have to be cuts elsewhere to meet Reeg’s half-billion-dollar savings quote.
That could result in further downsizing, pay cuts and other cost-reduction measures company-wide.
Analysts have warned that buying out Caesars could be a disastrous move for Eldorado, which generates only a quarter of its rival’s annual revenue.
If Reeg opts out, there are plenty of interested parties waiting in the wings.
Golden Nugget owner Tilman Fertitta is said to be on the lookout for investors, while Treasure Island has expressed interest in taking over Caesars’ Las Vegas Strip casinos.