Texas Casino Mogul Acquires Caesars

When most people think of the most influential people in the world of legal betting, a few familiar names pop up.

Steve Wynn. The Adelson family. Heck, even Donald Trump is still remembered for his casino ventures (although they largely failed).

But Tilman Fertitta now belongs on that short list. He’s more known for owning the Houston Rockets basketball team, but his latest buy has just made him one, if not the biggest, casino mogul alive today.

Already owner of the Golden Nugget casino empire, Fertitta Entertainment (the parent company) has agreed to acquire Caesars Entertainment in a massive $17.6 billion deal. If approved, the acquisition would give Fertitta control over some of the most recognizable casino properties in the whole world. Keep on reading, and we’ll break down the deal and its implications nationally, and in Texas betting, too.

Inside The $17.6 Billion Bet

Tilman was already sitting pretty with Golden Nugget. It may not have the brand name of MGM or Wynn, but Tilman’s existing empire does well for itself. Golden Nugget, across its properties in several states, does around $5 billion annually in revenue.

But Tilman wanted more. How about $11.5 billion more — that’s what Cesar’s does annually. It’s a big gamble for Tilman and company, and certainly doesn’t come cheap.

Under the agreement, Fertitta Entertainment will pay $31 per share for Caesars, representing roughly a 49 percent premium compared to where the stock traded before takeover rumors surfaced earlier this year. The deal also includes assuming approximately $12 billion in Caesars debt (phew, that’s a big number), bringing the total value to $17.6 billion.

Caesars portfolio includes some big-name properties like Caesars Palace, Harrah’s, Planet Hollywood, and Paris Las Vegas, among others. These are giant brands, something Golden Nugget currently lacks. And as you saw, the properties are making a good chunk of change, too.

If the deal is approved, the combined company would oversee roughly 60 gaming properties, though that number could change. Regulators may require certain casinos to be sold in markets where Caesars and Golden Nugget already compete against one another.

Atlantic City is one prime example. There are nine casinos there currently — four that would be owned by this mega-company. That might be too much for regulators, but that remains to be seen.

Moreover, Tillman’s company is currently private, while Caesars trades on the open market. The plan would be to go private if merged, but keep Caesars’ leadership in place. Then again, you always hear that early on during mergers. It doesn’t take long for cuts to be made, but we don’t want to speculate too hard on that.

Either way, Fertitta is on the cusp of entering rarified air as we explain in the next section.

Fertitta Is Suddenly In The Industry’s Top Tier

We don’t want to understate Fertitta’s track record. Never mind just the casinos or the Rockets ownership. No, no, Tilman is also a food and hospitality mogul.

Technically speaking, Golden Nugget is part of Landry’s. And this company also controls over 550 restaurants, hospitality venues, and entertainment concepts. That includes the likes of Morton’s, Mastro’s, and a few other steakhouses (it’s their speciality). So again, Fertitta has been a big name within the industry.

But buying Caesars vaults him into the stratosphere. This isn’t another regional casino or adding another restaurant chain. Caesars is one of the most iconic gambling brands in the world, and has been for the better part of a century now.

The acquisition also gives Fertitta something else: scale. A lot of scale, actually.

One of the stated goals is combining Caesars’ loyalty program with Golden Nugget and Landry’s rewards systems. The result could be one of the largest hospitality and gaming ecosystems in the country, allowing customers to earn and spend rewards across casinos, hotels, restaurants, and entertainment venues under one umbrella. That level of connectivity is a pipe dream for many brands, but a reality for Fertitta if this all goes through from here.

Texas Still Won’t Play Ball So Tilman Will Play Elsewhere

Despite becoming one of the most powerful gambling executives in America, Fertitta still can’t get the thing he probably wants most: casinos in Texas.

For years, gambling expansion efforts have gone nowhere in the Lone Star State. Bills get introduced. Lobbying money gets spent. Public support appears to grow. Then the proposals die. This goes for both casino gaming and sports betting apps, by the way.

And in this sense, Fertitta has actually taken a backseat to a different casino mogul, the Adelsons. They too own an NBA team in Texas (the Mavericks) and have lobbied hard to bring betting to Texas. So far, those efforts have gone nowhere.

Texas Lieutenant Governor Dan Patrick, who controls the state Senate, continues to vehemently oppose any kind of legalization. As long as that remains the case, the rest of the Texas Republicans will fall in line with Patrick.

Knowing that, you can understand Tilman’s motives here. Fertitta isn’t waiting around for Texas anymore. He’s expanding nationally, growing internationally, and positioning himself among the biggest names in gambling regardless of what his home state decides to do.

Texas can keep saying no. Fertitta has backup plans — and big ones at that.