State regulators in Indiana are likely to extend the term of casino divestiture due to the uncertainty in the casino industry amid the impact from the coronavirus.
Additional Year in the Works
The Indiana Gaming Commission (IGC) is expected to revise the terms for Caesars Entertainment regarding the sale of its casino properties in the state. In July, upon issuing a conditional approval for the merger between Caesars and Eldorado, the IGC requested the combined entity to divest 3 of its 5 casino properties in Indiana by the end of the year, to avert an “undue economic concentration” in the state.
In a statement issued Wednesday, the commission’s executive director Sara Tait hinted at a possible extension of the deadline for the divestiture of the Horseshoe Casino in Hammond with another year. The IGC is expected to revise the terms of the mandatory divestment during its meeting on Monday, November 23.
The property owned by former Eldorado Resorts, the Tropicana Casino in Evansville, was already sold for $480 million to real estate investment trust Gaming and Leisure Properties (GLPI) and Twin River Worldwide Holdings in October. Since then, Twin River acquired the Bally’s brand from Caesars and adopted the name Bally’s.
Caesars Entertainment is currently in exclusive negotiations to sell the Caesars Southern Indiana casino in Elizabeth within the specified December 31 deadline, as the Eastern Band of Cherokee Indians signed a letter of intent with Caesars this month, but the situation regarding the sale of the third property, the Horseshoe Casino in Hammond, could not be completed on time.
Horseshoe Hammond Sale Posing Challenges
Sara Tait said in the statement that the sale of the casino in Hammond presented “unique challenges” stemming from the uncertainty regarding gaming expansion in Chicago and south suburban Cook County, Illinois, as well as the severe impact of the ongoing health crisis caused by the coronavirus outbreak on the gaming industry in general.
The number of casinos in the Chicago suburbs is set to rapidly expand as a major resort casino is set to be built in downtown Chicago, in addition to a couple of other suburban casinos which are in the works at Hawthorne Park and another location south of the city, on top of the 5 existing already there.
Members of the regulator expressed their belief that granting the operator with more time to divest the property would be in the best interest of both the state and the local community and would not have a negative impact on the operations at the property.
In July, commissioners raised concerns that if Caesars is set to keep casinos that are meant for sale longer than 18 months, it may affect the properties negatively as the operator may neglect them, but now the IGC seems to have changed its perspective and is firmly set to offer a time relief to the casino giant.