GGRAsia – Activist investor Icahn again ups Caesars Ent holding

Activist investor Icahn again ups Caesars Ent holding

Mar 11, 2019 Newsdesk Latest News, Top of the deck, World

Activist investor Carl Icahn has in the space of four days increased for a second time his stake in United States-based casino operator Caesars Entertainment Corp.

According to a Monday filing by Caesars made to Nasdaq, Mr Icahn and entities linked to him, have boosted his interest from the 9.8 percent announced on March 1, to 17.75 percent. In the interim, it had been announced on March 8 that he had lifted his stake to 15.53 percent

The March 8 move had reportedly already made him the biggest-single investor in the group. The incremental increase announced on Monday reinforces the notion – mentioned at the time his aggregate 9.8-percent holding was announced – that he might wish to influence the business strategy of Caesars, a firm focused on the domestic U.S. market.

A March 1 statement had said Mr Icahn would be entitled to have three directors on the board of Caesars. The firm has not yet announced a name as replacement for chief executive Mark Frissora, who agreed to delay his departure until the end of April. A deal between Caesars and Mr Icahn provides the latter the right to appoint a fourth representative to the board if a new chief executive is not named within a 45-day period that commenced on March 1.

The Caesars group has for some years lagged behind in earnings terms compared to some of the other Nevada-based casino companies that managed to develop business in Asia.

The same day it was announced that Mr Icahn was further boosting his holding, Apollo Global Management Holdings GP LLC, had reported it was cutting its own stake in Caesars.

Private equity firms Apollo Global Management LLC and TPG Capital had led in 2008 an approximately US$30-billion leveraged buyout of the heavily-indebted Caesars group. Caesars was known until November 2010 as Harrah’s Entertainment Inc.

The final steps in the exit from bankruptcy of one of the Caesars’ units –Caesars Entertainment Operating Co Inc – were announced in October 2017, with the parent suggesting it would signal a new phase of expansion for the group.

The Caesars brand aspires to bid for a Japan casino licence and is currently preparing for construction of a foreigner-only casino resort – with a local partner – in Incheon, South Korea.

(Updated Mar 12, 9.30am)