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MTR Gaming Group And Eldorado Resorts Announce Merger Agreement

MTR Gaming Group, Inc. (NasdaqGS:MNTG) and Eldorado Resorts, LLC today announced that they have entered into a definitive agreement under which MTR Gaming Group will combine with the parent company of Eldorado Resorts, LLC in a stock merger. As part of the transaction, a cash election option will be offered at $5.15 per share for up to 5.8 million shares to MTR Gaming’s current stockholders. MTR Gaming’s remaining common shares will be exchanged for shares in the combined new company. The combined new company will remain publicly traded and be named Eldorado Resorts, Inc.

Under the terms of the agreement, the transaction value of Eldorado Resorts, LLC will be determined by LTM EBITDA at closing multiplied by 6.81x, less net debt and other adjustments. Based on Eldorado’s current LTM EBITDA as of June 30, 2013 (including its interest in Silver Legacy, a 50 / 50 joint venture with MGM Resorts International), Eldorado’s owners would be issued 35.6 million shares, or approximately 55% of the total shares, in the combined new company valued at $5.15 per share.

Gary Carano will be named the Chief Executive Officer of the combined company. The anticipated closing of the transaction is in mid-2014 and is subject to the customary regulatory and closing conditions being satisfied, including approval by MTR Gaming’s stockholders.

“We are excited to announce this transformative transaction, which creates a new gaming platform with a diversified portfolio across the country,” said Mr. Carano. “Our strong balance sheet will allow us to take advantage of future growth opportunities as the gaming industry continues to consolidate. In addition, we are thrilled to partner with the team at MTR Gaming, who have done a tremendous job in developing and operating the MTR portfolio. We believe that the MTR Gaming management team will be a significant part of our success going forward.”

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