Palms One Step Closer To Caesars Management?
Yesterday Palms got a little help with their finances in exchange for controlling interest of their casino, hotel and spa in Las Vegas when the announced a partnership with TGP Capital (the folks who helped Caesars go private a few years back) and Leonard Green.
The deal between TPG Capital and the Palms has been rumored for months but not confirmed until today. In January, Bloomberg reported that the firms had acquired most of a loan for the casino last year and sources close to the deal said the company may take an equity stake in the first quarter as part of the restructuring.
TPG Capital, along with Apollo Global Management, took Caesars Entertainment (then Harrah’s Entertainment) private for $30.7 billion in January 2008.
Nothing in the initial releases points to takeover by Caesars, but it has been speculated for a while (initially by Steve Friess and The Strip Podcast) that a sale/partnership/takeover could end up with Caesars taking control of the property.
In this case it seems to reason that the money guys will bring in their favorite casino partners, Caesars, to help run day to day operations.
Of course, this opens the question of how soon will the “loosest slots in town” and great video poker pay tables switch to the mediocre Caesars numbers uses. I think we have time here, but get ready.