Caesars Entertainment Corporation announced on Monday morning the news that the poker world has long known (or thought) was coming: it has sold the Rio All-Suite Hotel & Casino in Las Vegas, home of the World Series of Poker. The buyer is an unnamed company “controlled by a principal of Imperial Companies.” The total sales price is $516.3 million.
Caesars will still manage Rio for now
In a press release, Caesars said that it will lease the Rio from the buyer for at least the next two years at $45 million per year. The buyer then has the option to pay Caesars $7 million to lease the Rio for one more year. After that, it is up to the buyer and Caesars to decide what they want to do going forward.
It appears that Caesars will use the cash injection to beef up their other properties.
“This deal allows Caesars Entertainment to focus our resources on strengthening our attractive portfolio of recently renovated Strip properties and is expected to result in incremental EBITDA at those properties,” said Caesars Entertainment CEO Tony Rodio in Monday’s announcement. “The retention of the World Series of Poker and retention of Caesars Rewards customers are all factors that make this a valuable transaction for Caesars.”
Will the WSOP stay long-term?
As Rodio mentioned, Caesars will keep ownership of the World Series of Poker brand. The WSOP will stay at the Rio next year.
In an interview last week, WSOP Vice President of Corporate Communication Seth Palansky told CardPlayer that poker players should expect the World Series of Poker to be at the Rio in 2021, as well because events of that magnitude have to be booked years in advance. It should be noted, however, that his comment came before Caesars announced the sale, so while there were heavy assumptions that a sale was coming, there is no guarantee that the WSOP will be at the Rio after next year.
The big rumor for years regarding the WSOP has been that it will move Caesars Forum conference center, slated to open in 2020 behind the LINQ and Bally’s. Palansky downplayed this, as well, saying the WSOP isn’t “lucrative” enough to occupy a new facility for two months. That, and the fact that the Rio already has infrastructure built out and the WSOP has a decade and a half experience putting on the festival there.
Of course, one would think that the World Series of Poker would have to move at some point. It would be strange if Caesars decided it was fine holding it at a property it doesn’t own, considering all the money to be made from it (despite Palansky saying it’s not “lucrative”). The new owner would also need to be eager to keep the WSOP at the Rio.
Shares in Caesars Entertainment Corporation rose slightly on the news in early trading on Monday, but have been largely flat on the day.
The sale of the Rio continues a casino shakeup in Las Vegas. Less than a week ago, Bloomberg reported that MGM Resorts International was in talks with Blackstone Group to sell both the Bellagio and the MGM Grand in Las Vegas. Bloomberg also reported late in the week that MGM is in talks to sell Circus Circus. On the opposite end of the Strip, Hooters Casino was sold to India-based OYO Hotels. Earlier this year, Hard Rock International finalized the sale of the Hard Rock Las Vegas to a venture headed by Virgin Group.