It seems Carl Icahn has had enough of this gamble. The billionaire hedge-fund manager has just sold seven Tropicana Entertainment properties to Eldorado Resorts Inc. and Gaming and Leisure Properties Inc. The deal was worth a whopping $1.85 billion. And yes, it includes the Tropicana in Atlantic City.
Because of this, Eldorado’s shares have jumped as much as 21 percent. This led to an all-time high of $43.15. Gaming and Leisure Properties were also up, by 4.7 percent at $34.85.
Icahn still in the game
Icahn finalized a controlling interest in Vegas-based Tropicana back in 2010. This came at a time when Tropicana was fighting bankruptcy. However, he helped turn it around. Trop is now the third highest-grossing casino in AC in terms of gambling revenue, behind Borgata and Golden Nugget.
Yet it seems Icahn is on a selling streak. In March 2017 he sold the former Trump Taj Mahal Casino Resort. As you know, this will open as the new Hard Rock at the end of June this year. Icahn still owns the former Trump Plaza Hotel and Casino in AC, which has been closed since 2014. We wonder who will acquire it next…
Tropicana is Icahn’s second major sale in as many weeks. In fact, he also sold auto parts maker Federal-Mogul to Tenneco Inc. in a $5.4 billion deal. He had owned Tenneco for almost twenty years.
Eldorado taking over
The Reno-based company already owns and operates twenty properties in 10 US states. It seems well aware of the strong competition it faces. It enters Atlantic City knowing the market is about to grow with the reopening of two casinos this summer. The Hard Rock Hotel & Casino Atlantic City and Ocean Resort Casino mean there will soon be nine active casinos in AC. However, they feel they can operate Tropicana profitably.