Recently, casino megalith Harrah’s received the green light from the Nevada Gaming Control Board to acquire the Planet Hollywood Resort and Casino. The move would boost the number of Harrah’s Las Vegas Strip area properties to nine.
In addition to its flagship property, Harrah’s already owns Caesars Palace, Paris, Flamingo, Imperial Palace, Bally’s, Bill’s Gambling Hall, and the Rio, home of the annual World Series of Poker (WSOP). Planet Hollywood towers high above the Las Vegas Strip and was formerly dubbed the Aladdin. For poker players, Planet Hollywood offers a 15-table room with cash games that include $2/$4, $4/$8, and $5/$10 Texas Hold’em, Omaha, and Pineapple. The poker mill also offers four daily tournaments with buy-ins ranging between $50 and $70. The poker room is located on the main level next to the Miracle Mile mall entrance.
Nevada Gaming Control Board Chairman Dennis Neilander commented in the Las Vegas Review-Journal newspaper, “The existing Planet Hollywood was headed for some type of restructuring, perhaps a bankruptcy. We have some 40 properties that are in our bankruptcy group right now. This will offer a smooth transition for employees that are there and operating the business.” Next Thursday, February 18th, the Nevada Gaming Commission will formally approve or deny the Planet Hollywood sale to Harrah’s. If the Commission returns a positive result, ownership could change hands the next day.
According to the Review-Journal, Harrah’s acquired $306 million of Planet Hollywood’s debt for $70 million. In exchange, Planet Hollywood forked over 100% ownership of the Las Vegas Strip casino. The new ownership group will pump $30 million in working capital into the property and the news outlet expects that a $554 million mortgage loan “will remain leveraged against Planet Hollywood Resort after the deal is completed.” Planet Hollywood employs about 2,300 people, a staff that will allegedly be shaved by less than 5% as a result of the acquisition.
On January 16th, Harrah’s assumed the food and beverage operations of Planet Hollywood. Now, Harrah’s will be able to take the Planet Hollywood name and license it to other casinos around the world. Planet Hollywood – the restaurant – was formerly located in a multitude of cities across the United States including Atlanta, Nashville, and Reno. However, a series of bankruptcies and stiff competition led to only a handful of locations remaining in operation, including Honolulu, Myrtle Beach, New York City, and Las Vegas. Planet Hollywood also operates dining establishments in Cancun, Dubai, Jakarta, and Riyadh.
Harrah’s Chief Financial Officer Jonathan Halkyard told the Review-Journal, “We began to [buy the debt] because we felt Planet Hollywood would be a very complementary addition to our portfolio in Las Vegas.” In 2004, Harrah’s purchased the rights to the WSOP, ultimately moving the annual tournament series from the Horseshoe in Downtown Las Vegas to the Rio, just off the Strip. In 2005, the final days of the Main Event were held at the Horseshoe before the annual spectacle played out entirely at the Rio in 2006.
The WSOP Circuit brings the action of a major series to Harrah’s properties around the United States, including Harrah’s Tunica, Harvey’s Lake Tahoe, and Caesars Atlantic City.
Opening across the street from Planet Hollywood in Las Vegas in recent months was CityCenter, which consists of the Aria Casino, Mandalay Oriental, Veer Towers, and Crystals. The latter features upscale restaurants such as Eva Longoria Parker’s Beso, Mastro’s Ocean Club, and Brasserie Puck. Its posh retailers include Tiffany and Company, Prada, and Porsche. A walkway connecting this bustling area to Planet Hollywood may be extended, according to the Review-Journal, which would allow the fledgling casino to capitalize on foot traffic across the street.
Looks like Nevada and LV are jealous in not having their own too big to fail business until now.