Caesar Entertainment stock (NASDAQ:CZR) is up more than 10% on Wednesday following rumblings of a potential merger between the company and another casino operator.
Golden Nugget Casinos Tilman Fertitta wants to merge with the company in a deal that would value the casino operator at roughly $13 per share, according to statements from sources that chose to remain anonymous. The idea of the merger has been going around for about a week and it would see the companies exchange stock in a private company owned by Fertitta for shares in Caesars at the same multiple the company currently trades.
The deal would then se between a $2 billion and $3 billion dutch tender to give Caesars shareholders an option to sell, according to people familiar with the matter. Fertitta’s hospitality company is called Landry’s and it owns Golden Nugget Casinos, Morton’s steakhouses, Mastro’s, Bubba Gump Shrimp and more.
If the move goes through, it would allow the company to put a slew of its restaurants and brands into Caesar Entertainment’s locations, although sources said that the transaction would not involve the Houston Rockets in any way, which are owned by Fertitta.
The move would make Fertitta the chairman, CEO and largest shareholder of the combined company. The merger would also result in one of the largest gaming and hospitality companies in the world.
CZR stock is up more than 11% on Wednesday following the news.