Fertitta Entertainment is closing a $17.6bn acquisition of Caesars Entertainment. Caesars disclosed details of a months-long bidding contest between Fertitta and billionaire Carl Icahn that began in January and ended in August.
Fertitta offered $31 per share. Icahn raised his bid to $34 per share in July, but the Caesars board rejected it over debt financing concerns. A Jefferies commitment letter for $6.5bn lacked a date, signature and key terms — interest rates, covenants and the size of warrants for investors. Icahn required the Carano family to participate through a stock roll and insisted on keeping current management to handle change-of-control issues tied to debt and VICI lease arrangements. The Carano family, which holds 4.5% of the company, agreed to roll 5m shares into the Fertitta deal but turned down Icahn's financial terms.
Caesars extended Icahn's deadline to improve his offer until 10 August. No progress followed. The board recommended shareholders approve the Fertitta transaction. If closing does not occur by June next year, Fertitta will pay a daily per-share fee. A deal break triggers a $450m payment from Fertitta or $200m from Caesars.
Icahn bought into Caesars in 2019 and helped Eldorado acquire the company for $17.3bn, then sold his stake. He resumed buying shares in May 2024, capping his position at 5% in exchange for two board seats. Fertitta monitored the situation and notified the board in December of its intent to make an offer, starting the contest.
The deal awaits regulatory approval. Last month the Nevada Gaming Commission voted unanimously to amend the company's licences. A shareholder vote is scheduled soon.
