New bidder for Harrah’s
The world’s biggest casino operator, Harrah’s Entertainment, has confirmed that they are considering a bid led by Penn National Gaming and hedge fund D.E Shaw. The offer will be financially backed by the Lehman Brothers and Wachovia Corporation and they would receive some equity in the company if the deal was successful.
Harrah’s have refused to comment fully on the matter, declaring that a committee of non-management directors is reviewing the bid, with the offer thought to be around the $15.5 billion mark. Harrah’s spokesman, Alberto Lopez, was coy about the speculation.
"If we did have market-relevant news, we are very quick to release that info," he said.
The latest offer comes after two private equity firms, Apollo Management Group and Texas Pacific Group, made a bid last month of approximately $15.5 billion.
With a new bidder entering the frame, Harrah’s can gain some bargaining power and drive for a higher price but must be careful not to play each interested party off against each other.
Penn National own and operate horse racing parks and casinos and are much smaller than Harrah’s, so it is an ambitious move even with the financial backing they are receiving. However, no formal offer has been put on the table yet.
The news has led to shares in Harrah’s rising by 2.5 percent and if a deal went ahead, it would be the fourth-biggest buyout this year.
Editor, Jackpot.co.uk - 2006-11-29 11:15:14