Caesars Entertainment Corp. has created a new company to free up cash for new projects, according to a filing with the Securities and Exchange Commission.
Caesars’ new company — Caesars Growth Partners, LLC — will include its interactive gaming business, Planet Hollywood and a developing casino in Baltimore.
The gaming giant has created Caesars Acquisition Company to help close the deal, which includes a combined $500 million cash investment from Apollo Management and TPG Capital, the financial sponsors that will own “Growth Partners” with Caesars and its stockholders.
“The transaction is an important step in our ongoing efforts to improve the company’s balance sheet and position ourselves to make strategic investments,” Caesars Chairman Gary Loveman said in a statement. “The transaction enables us to raise equity capital at attractive valuations without diluting stockholders of Caesars and provides Caesars additional cash liquidity without incurring new debt.”
Caesars is currently weighed down by more than $20 billion in debt.
Mitch Garber, CEO of Caesars Interactive, will serve as CEO the acquisition company and continue with his role on the interactive side, the filing said.
Before moving forward, however, Caesars needs an approval from the Nevada Gaming Control Board.
At closing, Caesars expects to own 57 percent of the new company, the filing says, but its holdings could grow to as much as 77 percent.