Isle of Capri Casinos Inc. recently announced it will sell the Isle of Capri Casino Hotel Lake Charles to Kicks Entertainment LLC, an affiliate of Laguna Development Corporation, owned by the Pueblo of Laguna in Albuquerque, New Mexico, for 4.5 million. The sale will include Isle of Capri’s 50,000 square foot riverboat casino, 493-room hotel, various food and beverage outlets, covered parking and other amenities.
Isle of Capri Casinos Chief Executive Officer Eric Hausler said, “This transaction provides us with an opportunity to unlock significant value for our shareholders. On a pro forma basis, we expect the transaction to increase Adjusted EBITDA margins, while further deleveraging our balance sheet. Following the completion of the sale, we intend to use the cash proceeds we receive from this transaction to reduce debt and for other corporate purposes.”
Hausler added, “We have enjoyed owning and operating Isle of Capri Casino Hotel Lake Charles for more than 20 years, and we appreciate the hard work and dedication of our team. While we work on a smooth transition to Kicks Entertainment LLC, our focus remains on providing our customers with the great experiences they have come to expect from Isle of Capri Casino Hotel Lake Charles.”
LDC President and Chief Executive Officer Jerry Smith said, “Our acquisition of the Isle of Capri Casino in Lake Charles is the culmination of a two-year business development effort to expand LDC both within and outside of New Mexico. Lake Charles is Louisiana’s largest casino market. With our operating principals of quality, service and value we expect to continue to generate solid financial results for our owners and investors.”
LDC spokesman Skip Sayre added the new owners plan to install new slot machines, redecorate and offer more food and beverage options. Sayre noted Isle of Capri is a key gambling destination in the Lake Charles area, due to its stable target audience. “It has a certain part of the market share, a certain kind of customer that this brand appeals to. First thing is we keep those customers and keep them happy, and then offer other opportunities as far as our products and services that will allow us to grow the business,” Sayre said.
He added Laguna intends to retain the property’s nearly 1,000 employees. “We want them to stay with us, we’re not looking to come in and make a lot of management or staffing changes. Employees that are in good standing when the transaction does close in several months, they will have the opportunity to stay if they want to do that,” Sayre said.
The sale is expected to close in late fiscal 2017/early fiscal 2018, subject to the approval of the Louisiana Gaming Control Board and other regulatory considerations.
St. Louis, Missouri-based Isle earlier had indicated its intention to sell individual assets. The Lake Charles market in particular has been highly competitive since the Golden Nugget opened in December 2014. Isle of Capri Lake Charles generated $121 million in net revenue in fiscal 2016, a year-over-year drop of 5.5 percent. The region also has been challenged by flooding, causing occasional closures and damage.
Isle operates 14 other gaming and entertainment facilities in Colorado, Florida, Iowa, Louisiana, Mississippi, Missouri and Pennsylvania. The sale of its Lake Charles property will end its operations in Louisiana.
