Tropicana Entertainment to sell property, merge casino operations

Tropicana Entertainment to sell property, merge casino operations

Tropicana Entertainment to sell property, merge casino operations

Hedge fund manager Carl Ichan divested most of his casino holdings Monday after cutting a $1.85 billion deal to sell off Tropicana Entertainment.

The company reached a deal to sell Tropicana's real estate to Gaming and Leisure Properties Inc. "I would like to thank Carl Icahn, Icahn Enterprises and the Tropicana Board of Directors for their personal support, financial commitment and the confidence that they have shown in Tropicana's management".

Billionaire investor Carl Icahn is selling his Tropicana Entertainment casino empire.

The deal is targeted to close during the second half of the year.

Gaming and Leisure Properties, a company that owns 37 casinos in the USA, will add to its portfolio by acquiring almost all of Tropicana Entertainment's real estate, except the MontBleu and the Tropicana Aruba, for $1.21 billion.

Two other casinos under the Tropicana brand, the MontBleu Casino Resort & Spa in South Lake Tahoe and the Tropicana Aruba Resort and Casino, will be sold separately at Eldorado's request.

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Icahn continues a divestment from the casino-resort sector.

The billionaire investor had reinvested more than $200 million into the Atlantic City property, insiders say, and Tropicana Atlantic City expanded into the nearby boutique hotel The Chelsea past year.

The company said it enters the Atlantic City market realizing it is about to expand with the re-opening of two shuttered casinos that will increase the amount of properties to nine, but feels it can operate the Tropicana Atlantic City profitably.

Eldorado will acquire the operating assets of these properties and lease the real estate from Gaming and Leisure Properties through a new master lease with a 15 year initial term and four 5 year renewal periods. The company said the "Tropicana portfolio is in good shape and we have no immediate significant capex plans acquired properties".

Eldorado estimates its expanded portfolio after the deal will include almost 27,000 slot machines and video lottery terminals, 800 table games, and 12,500 hotel rooms. Opened in 1981, the hotel includes 2,215 guest rooms.

Additionally, Icahn a year ago sold the Trump Taj Mahal in Atlantic City to Hard Rock International, which is redeveloping the site as the Hard Rock Hotel & Casino Atlantic City.

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