Harrah’s buyout talk
Harrah’s Entertainment, the world’s largest casino operator, is reported to have received a buyout offer of around $16.7 billion from private equity firms Apollo Management and Texas Pacific Group.
Harrah’s are currently considering the offer and if a deal was to go ahead, it is likely it could be announced later this week.
The buyout bid follows the two private equity firms bid two months ago for the Las Vegas-based owner of Caesars Palace and Flamingo casino and is another example of private equity firms expanding their horizons looking for new ways to spend their ample coffers.
Apollo and Texas Pacific had an initial offer of £15.1 billion rejected back in October, which they then increased to $15.5 billion. Penn National Gaming Inc., a casino company much smaller than Harrah’s, then became alerted to the situation and came in with a bid of $87 per share.
On Friday, shares in Harrah’s rose by 0.5 per cent, up to $79.50. The gap between the current share price and the bids put forward has been put down to investors waiting to see how the takeover talks develop, as well as doubts that any deal could not be completed for over a year due to concerns over casino licencing requirements.
Any potential deal would be one of the top ten biggest private equity buyouts this year and would also top Harrah’s own $9.4 billion takeover of Caesar’s Entertainment Inc. last year as the largest casino acquisition. Harrah’s also completed the buyout of U.K casino operator London Clubs International this year for $570 million.
Editor, Jackpot.co.uk - 2006-12-18 11:35:28