What will sale of Caesars mean for Biloxi and Harrah’s Gulf Coast?
AI-generated summary reviewed by our newsroom.
- The sale announcement of Caesars to Fertitta was made May 28.
- Mississippi regulators must review and approve the sale at a Gaming Commission meeting.
- Golden Nugget Biloxi and Harrah’s Gulf Coast will be owned by Fertitta Entertainment.
They are just a couple blocks apart in east Biloxi and both Golden Nugget and Harrah’s Gulf Coast casinos will be owned by the same company when a $17.6 billion sale is finalized.
The announcement of the sale of Caesars Entertainment to Fertitta Entertainment came Thursday, May 28, in a news release that calls the transaction “A transformational combination of two world-class companies.”
At first glance, it would seem Caesars is the Goliath in this deal, operating more than 50 casinos in 13 states and 5 countries. The Reno, Nevada-based casino, though, has amassed $11.9 billion in outstanding debt that will be assumed in the sale.
Eight Golden Nugget casinos are located in Biloxi, Nevada, New Jersey, Louisiana, Colorado and Illinois. Fertitta Entertainment is a private company that has more than 550 business outlets around the world, including resorts, hotels, entertainment complexes and 450 restaurants.
“The combination of Caesars and Fertitta Entertainment brings together two iconic and highly complementary platforms, delivering guests an unmatched suite of gaming, entertainment and restaurant brands under one roof,” Fertitta Entertainment said.
The deal gives Caesars a “go-shop” window until July 11 for the company to consider any competing bids before the sales process goes forward.
Two casinos in one market
Sometimes a merger or casino buyout triggers the Federal Trade Commission to require a casino in a competing market be sold to satisfy antitrust laws. In 2019, the FTC required Penn National Gaming and Pinnacle Entertainment to divest three casinos because they might harm competition for casinos in St. Louis, Kansas City and Cincinnati.
There is no indication that’s ever happened in Mississippi, and Jay McDaniel, executive director of the Mississippi Gaming Commission said while’s it’s up to the Federal Trade Commission, he doesn’t see a problem with this acquisition.
Fertitta Entertainment will be required to come to a Gaming Commission meeting and ask for approval from Mississippi and all the other states where the casinos will operate.
“The commissioners will have to analyze this sale,” McDaniel said, and their decision will depend on how the casinos are set up and plan to run.
Because the purchaser and seller already are operating in Biloxi, in a market where there are 12 casinos, there wouldn’t appear to be an issue with competition, he said. Unless the FTC sees anything negative about it, McDaniel said he expects the state regulators to authorize the sale.
The Biloxi location is the only Golden Nugget Casino in Mississippi, while Caesars Entertainment has three others: Trop Casino Greenville, Isle in Lula and Horseshoe Tunica.
The Tunica Roadhouse operated right next to the Horseshoe before it was demolished.
Caesars has eight properties on the Las Vegas Strip and four of nine casinos in Atlantic City would be operated by Fertitta Entertainment.
Good for Biloxi
Fertitta Entertainment doesn’t plan a big shakeup when the sale is complete, which could take a year.
“The leadership teams of both companies are all expected to remain in their current roles and continue to lead the combined companies’ operations.” Fertitta Entertainment announced.
That’s good news for Biloxi, said Allen Godfrey, who worked with the management of the Golden Nugget and Harrah’s Gulf Coast while he was executive director of the Mississippi Gaming Commission. He’s now deputy director of the state Hotel Gaming and Hospitality Association and said Jonathan Jones at Harrah’s and Chett Harrison at Golden Nugget Biloxi have done a “phenomenal job” of running their respective casinos.
“They’ve both been in the business, both demonstrated that they’re very capable of running a top operation,” he said.
This is the second time in seven years Caesars Entertainment was sold to a competitor. In 2019, Eldorado purchased the company for $17.3 million and then changed its name to the Caesars brand. At that time, Tilman Fertitta also was interested in buying the company.
Billionaire, ambassador and team owner
Media reports since the announcement of the sale speculated on the price of the deal, but few questioned Tilman Fertitta’s ability to make it work.
Fertitta started in the hospitality business peeling shrimp at his father’s restaurant before he opened his first seafood place in Texas. He built an empire of restaurants under the Landry’s brand, starred in the television series “Billion Dollar Buyer,” where he filmed some of the episodes in South Mississippi, is a New York Times best-selling author and owns the NBA’s Houston Rockets team.
His bio says he is the largest shareholder with a 12.5 percent stake in Wynn Resorts and the largest individual shareholder in DraftKings online gambling platform. Forbes ranks him among the 100 wealthiest people in America.
While he is the sole owner of Fertitta Entertainment, in 2005 he stepped back from many of his business interests and serves as United States Ambassador to Italy and San Marino.
What the Biloxi combo brings
One of the outcomes of the sale might be more popular restaurants could open inside Harrah’s Gulf Coast.
Landry’s restaurant in Biloxi was lost during Hurricane Katrina, and it is among several of the company’s popular brands, such as Chart House and Rainforest Cafe.
Golden Nugget Biloxi opened in 2013, after a $150 million investment for the purchase and a complete remodel. “Every square foot will be touched,” Fertitta said at the time. “Everything will be brand new.” He delivered and also hired more staff to operate the resort.
Golden Nugget is quite a bit larger than Harrah’s Gulf Coast. Golden Nugget has 737 employees to Harrah’s 441, along with 706 hotel rooms and suites to 499 at Harrah’s.
The addition of Harrah’s to the mix brings some big benefits to Fertitta Entertainment. It’s Caesars Rewards players club program is one of the largest in the industry, and combined with the Golden Nugget and Landry’s programs, could bring more first-time visitors to Biloxi.
Harrah’s has experience operating an air program to fly customers in to fill beds and seats at the slot machines. Harrah’s has more parking and owns quite a bit of land besides where the casino sits, so there is room for the expansion of the resort and adding more amenities or lodging. Combined with Golden Nugget’s resort pool, spa, entertainment and meeting and convention space, plus the adjoining marina, the partnership between the casinos could grow the local market, which the Gaming Commission has worked toward for years.
