- The Eldorado Resorts-Caesars Entertainment Corp. merger will result in job cuts.
- Bret Yunker, the Chief Financial Officer, said that the new company is planning to reduce the jobs with a lot of compassion and transparency.
- The CFO didn’t specify where the company would reduce the jobs or how many employees would lose employment.
- Yunker said that the start is going to be challenging, but he remained optimistic about Las Vegas.
The Eldorado Resorts-Caesars Entertainment Corp. will result in some job cuts. However, CFO Bret Yunker said that the new Caesars Entertainment Inc. is planning to make the cuts with a lot of compassion and transparency. He didn’t specify where the company would reduce the jobs or how many people would lose their jobs.
Before the coronavirus pandemic resulted in layoffs, Caesars had about 30,000 and 65,000 employees in Las Vegas and globally, respectively. Similarly, Eldorado had about 18,000 employees.
Yunker said that the merger will create “substantial synergies.” However, he admitted that the job reductions were a challenge. Yunker added that they were committed “to do that as compassionately and transparently as possible.”
Eldorado, a Reno-based firm, became the biggest gaming company worldwide when it acquired Caesars at $17.3 billion. The merged company is now the owner and operator of at least 55 casinos in 16 US states, including eight Las Vegas Strip resorts.
Younker hopes that the combined strength of the merger would help the new company reopen more casinos that were closed during the pandemic. Nevada governor Steve Sisolak had ordered the closure of all casinos in mid-March to reduce the spread of COVID-19 but permitted them to reopen from June 4.
Bally’s Las Vegas Hotel & Casino is set to reopen Thursday this week as other Caesars properties, including the Cromwell and Planet Hollywood, remain shuttered. Yunker said they have been doing everything possible to reopen their Nevada and Las Vegas properties so that employees can resume working.
Although the pandemic brought trouble to the tourism industry and reduced casino revenues, the CFO said that Eldorado wasn’t ready to back away from the deal. He admitted that while the present situation is challenging, they were very optimistic about Las Vegas. The CFO acknowledged that the company had a debt of about $13 billion, extra obligations to VICI properties, and a separate real estate investment trust.
Yunker said that it was good that the two companies sealed the deal when they were under-leveraged. While the transaction resulted in some incremental leverage, he used his experience to gauge how the portfolio would generate cash flows in the hardest of times. He added that the company’s balance sheet, portfolio of properties, and abundance of liquidity were going to see them “through to the other side.”
The CFO also confirmed what Eldorado officials had previously mentioned the possibility of the new company selling a Las Vegas property. However, Yunker said that they were still deliberating on the matter in line with what’s happening around the globe, in Sin City, and with the pandemic.
To get the merger approval and avoid anti-trust problems, the Federal Trade Commission and Indiana regulators required Eldorado to sell some of their properties.