The Nevada based gaming hotel and casino corporation has agreed to combine with Eldorado Resorts in a cash and stock deal worth a total of $17.3 billion.
Eldorado will acquire all of the outstanding shares of Caesars for a total value of $12.75 per share, consisting of $8.40 per share in cash consideration and a fraction of shares of Eldorado common stock for each Caesars share of common stock
A sale of Caesars has been pushed for by activist investor Carl Icahn, who gained control of three board seats a few months ago. This morning he praised the deal saying,
"As a combined company, Caesars and Eldorado will be America's preeminent gaming company. It is rare that you see a merger where because of the great synergies "one plus one equals five." I look forward to seeing our investment prosper."
In order to pay down debt form the deal the new combined company will sell some of its real estate to VICI Properties, a REIT that will now oversee numerous properties under the Caesars-owned Harrah's banner.
The deal should help the combined company compete with larger gaming competitors, such as Wynn Resorts (WYNN - Get Report) and Las Vegas Sands (LVS - Get Report) in the increasingly crowded industry. After the deal, Caesars shareholders will own 49% of the new company.
For more details on the deal, an analysis of what the charts are telling us about it, and the outlook for the broader gaming industry in coming years, head over to Real Money where we'll be covering the stock all day.
Ask Cramer: 3 Signs a Market Has Gotten Frothy