Casino stocks fell in a rising Monday market as the coronavirus has forced them to close their facilities, destroying revenue.
That’s because last year’s announced deal under which Eldorado would take over Caesars for $8.5 billion in cash and stock has failed to gain the attention of regulators, who must approve it. The regulators are preoccupied with the coronavirus.
Other gambling stocks that are down Monday include MGM Resorts (MGM) - Get Report, Boyd Gaming (BYD) - Get Report and Penn National Gaming (PENN) - Get Report. Las Vegas Sands (LVS) - Get Report bucked the trend, rising 1.9%.
Eldorado has tumbled the most, down 24% to $11.46 at last check. It closed its gambling facilities two weeks ago.
The news was better for the company before the coronavirus outbreak in the U.S. It said Feb. 20 that the Mississippi Gaming Commission cleared the Caesars deal. At that point, Eldorado expected to close the transaction in the first half.
Caesars shares fell 6.2% to $6.43 at last check. Two weeks ago it said it was shutting down its North American properties.
“It has become clear that we must take this extreme action to help contain the virus and protect the safety and well-being of our team members and guests,” Caesars CEO Tony Rodio said then in a statement .
Eldorado shares have given up 76% in the past month, and Caesars shares have dropped 48%. The S&P 500 index has declined 12% during the same period.