Caesars Entertainment Inc. Chief Financial Officer Bret Yunker.
The merger of Eldorado Resorts and Caesars Entertainment Corp. will result in job cuts, but the new company plans to make the cuts in the “most compassionate and transparent way possible,” Chief Financial Officer Bret Yunker said.
Yunker, who served as CFO with Eldorado and now with the new Caesars Entertainment Inc., did not specify how many jobs would be eliminated or where the reductions would occur.
Before the layoffs resulting from the coronavirus pandemic, Caesars had about 30,000 employees in Las Vegas and about 65,000 worldwide. Eldorado had about 18,000 workers.
“We remain focused on creating substantial synergies as we bring these two companies together,” Yunker said. “That, unfortunately, will result in some job cuts. Reducing the size of a workforce is always a challenge. We are committed to doing it in the most compassionate and transparent way possible. ”
Eldorado, a Reno-based company, announced Monday that it had completed the $ 17.3 billion deal to acquire Caesars, making it the largest gaming company in the world. The merged company owns and operates more than 55 casinos in 16 US states, including eight resorts on the Las Vegas Strip.
Yunker said he hoped that “combined portfolio strength” would help the company continue to reopen closed casinos during the pandemic.
In Nevada, Governor Steve Sisolak ordered all casinos to be closed in mid-March to help curb the spread of the virus. They were allowed to start reopening on June 4.
“We have the Bally opening later this week (Thursday), so we’ve been doing everything we can to open properties in Las Vegas and Nevada to help employees get back to work,” Yunker said.
Two other Caesars properties on the Strip, Planet Hollywood and Cromwell, remain closed. The River, just west of the Strip, has also not resumed operations.
While the coronavirus has wreaked havoc on the tourism industry, decimating casino revenues, Yunker said Eldorado never considered withdrawing from the deal.
“When you’re on that stage, you have to think about everything, but we never stop,” Yunker said. “The strategic logic of the merger, in any scenario, would always make sense to us.
“In the meantime, it is going to be a challenge,” Yunker said. “Once we get to the other side of this, Las Vegas is as unique as it seems. We are totally optimistic in Las Vegas. “
The company has approximately $ 13 billion in debt, along with additional obligations to VICI Properties and another real estate investment trust, Yunker acknowledged.
But both companies “entered the merger with little leverage, which was good,” Yunker said. “Yes, there is incremental leverage as part of the transaction, but, having been in the industry and executed hundreds of gaming credit transactions, I saw a battleship portfolio that will generate cash flows at all times.”
“We also create a large amount of liquidity to deal with any operational uncertainty in the short term. Our portfolio of properties, balance and liquidity will take us to the other side, ”he said.
As Eldorado officials have previously mentioned, Yunker said the new company may be able to sell a property in Las Vegas.
“We have been talking about that since we announced the transaction last June, but there is no actual update,” Yunker said. “We consider managing more than 20,000 rooms, from a strategic perspective alone, not ideal for the combined company. We’re still going to think about when the time is right to divest a Strip asset, probably in the next 12 to 18 months. Some of that will be driven by what’s happening in the world, in Las Vegas and with the virus. “
As part of approval of the merger, the Federal Trade Commission required Eldorado to sell properties in Lake Tahoe and Shreveport, Louisiana, to avoid competition concerns.
Earlier this year, Eldorado also agreed to sell casinos in Mississippi and Missouri. Indiana regulators demanded the sale of three casinos for the merger to go ahead.
The combined company retains the Caesars name and stock symbol, though it unveiled a new logo on Monday.
“Caesars is the iconic brand in games. There is a reason why we are changing our name, because you can’t find a better name in games, “Yunker said.
The new company will focus on “family-style service” that has been a registered trademark since Don Carano opened the Casino Eldorado Hotel in Reno in 1973, Yunker said.
Carano’s son Gary Carano is CEO of the merged company’s board of directors, which includes a mix of former Eldorado and Caesars board members.
Gary’s son Anthony Carano is director of operations for the new company, a title he held with Eldorado. Tom Reeg, also of Eldorado, is the new CEO of the company, although former Caesars CEO Tony Rodio remains an advisor.
Caesars’ new corporate headquarters will be in Reno, although there will be a large corporate presence in Las Vegas, Yunker said.
Billionaire investor Carl Icahn is now the company’s largest individual shareholder, and owns more than 10% of the new Caesars. Ichan acquired a large block of old Caesars shares after the company emerged from bankruptcy protection in late 2017.
Associated Press contributed to this report.
