Caesars May Sell Mobile, Social Games Unit For $4 Billion: Reports
Two months after a court-ordered bankruptcy examiner said casino company Caesars Entertainment Corp. could be liable for up to $5.1 billion in damages, its affiliate Caesars Acquisition Co. is said to be considering the sale of its Interactive Entertainment, Inc. unit.
The company has reportedly received bids that value the social and mobile gaming business at about $4 billion. The sale, if it happens, could provide the group with much-needed cash.
However, matters are not quite that straightforward. In a highly complex structure of ownership, Caesars Entertainment — itself owned by its private equity backers, Apollo Management Group and TPG — holds a majority stake in Caesars Growth Partners, which is the company that owns Caesars Acquisition. Caesars Interactive Entertainment is controlled by Caesars Acquisition, while Caesars Entertainment, which owns part of it, does not have voting control.
Caesars Interactive Entertainment, which saw its revenues increase by about 303 percent in 2015, received multiple unsolicited bids, according to unidentified sources who spoke to various media outlets, who added that the company would consider the bids but there was no assurance of a sale. The Wall Street Journal, which first reported the story Friday, said bidders included financial firms, as well as gaming, media and entertainment companies.
However, an ongoing bankruptcy case against Caesars Entertainment — allegedly a result of the complex corporate restructuring that its creditors claim stripped away most of the value from the company — could complicate any potential deal.
Shares of Caesars Entertainment were down 2.8 percent on Nasdaq at the close of trade Friday, while shares of Caesars Acquisition, also a publicly traded company, fell by 3.33 percent.
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