Eldorado Resorts agreed to pay .5 million to buy MGM Resort Internationals 50 percent interest in the Silver Legacy Resort Casino and Circus Circus Reno.
Eldorado announced the deal on November 27, which gives Eldorado full control of three largest casinos and hotels in downtown Reno, including the Eldorado, which it already wholly owned.
“We are very excited to welcome the Silver Legacy and Circus Circus Reno employees to the Eldorado family at a time when the Reno gaming market and the northern Nevada economy is prospering,” Eldorado Chairman and CEO Gary Carano said. “The addition of Silver Legacy and Circus Circus Reno to our operations is consistent with our strategy to enhance shareholder value by pursuing strategically and economically attractive transactions.”
Eldorado first announced the deal during the summer and obtained regulatory approval from the Nevada Gaming Commission on November 19. The transaction also required Eldorado to pay down $58 million of the Silver Legacy’s debt, and it gives Eldorado a total of seven gaming properties in the United States.
An improved economy in Reno, which includes the planned construction of a Tesla Motors factory for building batteries for high-end electric cars, helped make the deal a reality for Eldorado Resorts.
“The transaction is immediately accretive to our free cash flow and strengthens our position in the Reno market, where gross gaming revenues are up more than 3.5 percent year-over-year through September,” Eldorado President Tom Reeg said. “We expect to realize significant cost and revenue synergies with the tri-properties now under common ownership.”
Carano said Eldorado will invest in the Circus Circus Reno and renovate the aging property to help keep it fresh and new, and to help with the overall goal of growing local revenue from the three Reno casinos. The Silver Legacy and Circus Circus Reno are connected to the Eldorado Reno casino via pedestrian bridges.
Eldorado also will streamline operations, by combining the marketing departments at the three properties into one, but without laying off staff, Carano said.
The deal gives Eldorado Resorts a total of 10,230 slot machines, 300 gaming tables and three pari-mutuel operations at its seven properties across the nation, while boosting its hotel rooms total to 4,850.
The Silver Legacy has 1,302 slot machines, 63 table games, and 1,711 hotel rooms, while Circus Circus Reno has 908 slot machines, 33 table games, and 1,571 hotel rooms, including 141 suites.
