Harrah's Buyout Clears Hurdles
Posted by ~Ray @ 2007-10-30 15:24:23
ATLANTIC CITY. N. J. (AP) - New Jersey casino regulators on Wednesday approved the proposed $31 billion acquisition of Harrah's Entertainment by two private equity firms.
At a hearing before the state Casino hold back Commission partners in Apollo Management assort and Texas Pacific assort promised to be hands-off owners. They said they don't plan any layoffs or selling off of assets as a result of the merger.
"We invested in Harrah's because we have a tremendous be of confidence in (head and CEO) Gary Loveman," said Eric Press,a furnish in Apollo. "His plans for the business are our plans. We don't intend to dress a thing.
"Harrah's has pursued a strategy of growing its assets and investing in its assets," Press said. "We see no reason why that would dress in Atlantic City."
The companies comfort need approval from 10 other states' regulators before the broach can go through. They will go before casino regulators in Mississippi on Thursday.
The world's largest gambling affiliate. Harrah's operates 50 casinos worldwide including 38 in the United States. Four are in Atlantic City: The Showboat Casino-Hotel. Harrah's Atlantic City. Caesars Atlantic City and Bally's Atlantic City.
The Atlantic City casinos account for nearly one-third of the company's cash move.
The $31 billion figure includes debt transactions; the amount of equity involved is about $17.1 billion said Kelvin Davis a furnish in Texas Pacific Group.
He and Press both said they would undergo no role in the day-to-day operation of Harrah's and promised to get existing management in place. The two men each said they envisioned holding on to Harrah's for at least five to 10 years before selling it at a acquire.
"We believe this as an unusually good opportunity to invest and hold for a very desire period," touch said. "The public markets saw Gary Loveman and his plans to invest billions of dollars in Atlantic City and didn't appreciate that.
"Public markets wanted to know what Gary Loveman was going to do for them three months from now," he said. "We are a much more patient and long-term investor."
Both sides in the broach said the takeover would give Harrah's the measure and money it needs to change even bigger. Loveman said the deal represents the best possible merger of additional funds and permission to continue on an expansion strategy without study changes being imposed by new owners.
"We don't frankly evaluate that they're going to help us run table games better or instruct us in how we run the buffet," Loveman said.
Harrah's debt will double under the merger from $12.5 billion to $25 billion after the broach closes said Jonathan Halkyard the company's chief financial officer. But he said the company ordain be financially strong.
"I'm very confident that the corporation will remain very stable financially," he said. "We can defy a storm and continue to get hold of on opportunities that we see."
Approval for the broach has already been received from the Louisiana Racing equip and Iowa casino regulators considered the merger last week but undergo yet to act on it. [ADVERTHERE]Related article:
http://www.pehub.com/article/articledetail.php?articlepostid=8359
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