"The largest U.S. casino owner has $21 billion-plus in debt and racked up losses of $1.5 billion and $687.6 million in the past two fiscal years. And when South Korea last week rejected a license for a $500 million casino in which Caesars had a 40 percent stake, Reuters reported Caesars’ credit rating as a reason."
What other business would get away with this? Would government get in bed with any other kind of business with this abysmal record?
For that matter, why would Plainville want to throw in with Plainridge, which has't made a profit in more than a decade?
What other business would get away with this? Would government get in bed with any other kind of business with this abysmal record?
For that matter, why would Plainville want to throw in with Plainridge, which has't made a profit in more than a decade?
Caesars gambles on credit Casino owner has $21 billion in debt and racking up big losses
Thursday, June 27, 2013
By: Donna Goodison
Despite its precarious financial health, Caesars Entertainment remains confident it will pass state Gaming Commission background checks as part of its partnership’s bid to build a $1 billion resort casino at Suffolk Downs.
The largest U.S. casino owner has $21 billion-plus in debt and racked up losses of $1.5 billion and
$687.6 million in the past two fiscal years. And when South Korea last week rejected a license for a $500 million casino in which Caesars had a 40 percent stake, Reuters reported Caesars’ credit rating as a reason.
“That’s probably going to spook the Massachusetts gaming regulators,” said Chad Beynon, a gaming industry analyst at Macquarie Capital.
“They’re a highly leveraged company that’s barely paying their bills. What they bring to the table is obviously management expertise, decades’ worth of understanding gaming and the marketing side of it. But they just don’t have the balance sheet.”
The state Gaming Commission is currently investigating the financial integrity and viability of all casino license applicants. Spokeswoman Elaine Driscoll declined to speculate about the outcome.
Representatives of Caesars and its Suffolk Downs partners said they’re confident in their East Boston gaming proposal in which Caesars has a 4.2 percent stake.
“The Suffolk Downs partnership with Caesars Entertainment is more than capable of financing the development of a world-class resort,” said Chip Tuttle, Suffolk Downs’ chief operating officer.John Payne, Caesars’ president of central markets and partnership development, said Caesars has more than $2 billion in cash and, with other partners, has successfully financed and developed three projects in Ohio and is in the final stages of financing a development in Baltimore.
But RBC Capital Markets analyst John Kempf believes Caesars’ burn rate will quickly eat into its cash and force it — if not into bankruptcy — into a restructuring with lenders late next year or 2015.
Still, he said, Caesars’ financial health shouldn’t interfere with Suffolk Downs’ bid for a gaming license: “It would only be a part investor in the whole project, and that’s a key difference.” -
- See more at: http://bostonherald.com/business/business_markets/2013/06/caesars_gambles_on_credit#sthash.2CG8HRx3.r16N1iqu.dpuf
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