Carl Icahn has bought an even bigger stake in Caesar's Entertainment
March 11, 2019
Carl Icahn, an American billionaire philanthropist and businessman, has bought an even bigger stake in Caesar's Entertainment. Icahn rose his stakes from 9.8 percent up to 15.53 percent, and as part of this deal with Carl Icahn, the casino will replace three of its current board directors with members that Icahn has personally chosen.
Seeking Fundamental Changes from Within
Most people won't raise an eyebrow when they realize Icahn plans to change the casino and resort and mold it to his own will. Caesar's Entertainment owns some iconic entertainment venues that include:
- Zappos Theater
- Colosseum at Caesar's Palace
- Planet Hollywood
Who Does This Benefit?
If you were to ask Carl Icahn, you'd hear him say that this new merger benefits the shareholders because he argues how the gambling company has largely underperformed compared to its competitors. Mark Fressora, once the CEO of Caesar's Entertainment, will resign from his position in the coming April. Unfortunately, under Fressora's leadership, the company went through a post-bankruptcy restructuring plan. While Caesar's Entertainment planned to get rid of Fressora in February 2019, they said that they had to push this back to April 2019 because of how they had to search for Fressora's replacement. Getting rid of the CEO that bears some of the responsibility for the company's bankruptcy woes could directly benefit the shareholders and Carl Icahn especially.
Who Could Replace Mark Fressora?
Carl Icahn has said that he wants the billionaire Anthony Rodio to take Fressora's place. Anthony Rodio does have an impressive resume when you look at it for the role of CEO. In fact, he previously worked as the CEO for Tropicana Entertainment. Last year, Icahn sold this casino over to Eldorado Resorts.
With a 15.6 percent stake in Caesar's Entertainment, Carl Icahn gets much say in how this business will be operated. Previously, he threatened to replace all the board directors if his needs weren't met. Caesar's Entertainment has been a company that has fallen on hard times and had to struggle to come out of Chapter 11 Bankruptcy back in 2017. This company lost 47 percent of its value last year, which goes to show the hard times that have befallen the company. The high possibility is that Caesar's Entertainment will get acquired by Eldorado Resorts. Tilman Fertitta has expressed some interest in acquiring the struggling business. The process, however, will need to be thoroughly strategic whether Icahn chooses to sell or merge it.