One of the biggest casino purchases ever was announced this week when Eldorado Resorts agreed to buy Caesars Entertainment for roughly $17.3 billion in cash and stock.
While the news is mostly good all around, one unfortunate spin-off of the deal is that the popular Bally’s casino in Atlantic City could be forced to shut down as a result.
Although most of the focus of the Caesars purchase has been focused around the fact that Eldorado will now compete with other mega players like Las Vegas Sands, Wynn Resorts and MGM Resorts International.
However, in the state of New Jersey, regulators have been examining what this means for Atlantic City and they have some concerns. With acquisition of Caesars Entertainment, that now means that Eldorado holds control of four of Atlantic City’s nine casinos.
Those include Tropicana, Caesars, Harrah’s and Bally’s. That means they’re starting to control a bit too much of the market for the regulators’ liking. As a result, there will likely be a thorough examination and likely a judgement that forces Eldorado out of one of the casinos. That could mean either a sale or a closure altogether.
Eldorado’s primary plan is to get the deal done and earn approval without divesting from Bally’s. The state of New Jersey and the gaming commission will have to think about it this carefully as if they don’t approve the deal, it would likely lead to the casino closing. That would mean a loss of jobs and a loss of revenue for the state.
The issue is that Caesars had already been considering closing Bally’s but they instead closed the Revel Casino a few years ago. Even so, Caesars had been neglecting Bally’s as it’s mostly become a fading spot in Atlantic City. The hotel-casino had been known for its pink tinted windows on the boardwalk.
However, broken windows have now been replaced with plan-colored windows. That goes to show just how little they’ve invested into the spot. They’ve also had issues of lead poisoning in some rooms and have generally done little for the upkeep of the hotel.
The challenge for the state of New Jersey is that if they decide not to let Eldorado hold four of the nine casinos, that likely leads to the closure of Bally’s. There are currently 2700 employees in the casino and while their revenues dropped nine-percent last year, they still reeled in $192 million.
At one time, Bally’s was the biggest and best of Atlantic City. It’s definitely faded but closing it completely will still hurt. We’ll see what they decide to do in the coming months.