The US is about to see its biggest gaming company take shape in early 2020. Surely by now, no one has escaped the Caesars and Eldorado $17.3 Billion merger deal. And with its completion in focus, some interesting figures have come to surface.
In fact, the new entity that will operate under the Caesars name will control 30% of the Atlantic City (AC) market. But what’s more, they’re going to represent around 37% of the total gaming revenue. Plus, they’ll employ roughly 40% of the workforce connected to the industry.
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AC needs to step it up
Although, financial reports state that both Caesars and Eldorado project positive numbers for the upcoming deal. AC could be the main denominator for its performance yields. Indeed, the second quarter revealed that only the Las Vegas properties contributed to the 4.9% revenue increase. While AC and other regional jurisdictions showed a decline.
The less than optimistic figures pointed the fingers at the stiff competition in the Garden State. And according to Caesars CEO Tony Rodio. The three AC properties Harrah’s, Caesars, and Bally’s underperformed when compared to the competition.
He added with enthusiasm and hope that “If other properties could figure out a way to hold on to market share to some degree. And then to do it on a profitable basis. I certainly think Caesars Entertainment should be able to do it.”
Build it and they will come
Rodio also pointed out that investment to the properties could be the solution. He also believes that a new venture in non-gaming amenities would give people a reason to show up and added – “If you look at the properties that are successful. It’s properties that have reinvested in the experience. And I think that we have failed to do that over the last couple of years.”
However, the merger is not completed yet since the New Jersey gaming regulators haven’t given it the green light. So, if the deal falls under the “undue economic concentration”. One of the solutions could instead be to sell off the least profitable asset to offset the expenses. And doing so could prove to be either the right or wrong move. It all depends on the expert you speak with. And of course, it also depends on AC’s overall growth.