Nevada panel endorses Park Place-Caesars deal

Brendan Riley

Thursday, Oct. 7, 1999 | 10:01 a.m.

CARSON CITY, Nev. - A $3 billion acquisition of Caesars World Inc. by Park Place Entertainment Corp. has won an expected preliminary endorsement from Nevada casino regulators.

The deal, described by Park Place lawyer Jack Godfrey as the largest transaction involving "purely gaming interests" in history was recommended Wednesday by the state Gaming Control Board.

The board's parent Nevada Gaming Commission will have final say at an Oct. 21 meeting here.

Mark Dodson, Park Place executive vice president, said the Caesars name would be retained.

Scott LaPorta, Park Place chief financial officer, said the corporation will retain its strong credit rating in the deal, which is not final until regulatory approvals are granted in various jurisdictions, including Nevada, New Jersey and Mississippi.

The Park Place representatives also told the Control Board that the previously announced acquisition of Caesars from Starwood Hotels & Resorts is being financed by two credit lines, one for $2 billion and the other for $1 billion.

Earlier, Park Place said it had commitments from 20 to 25 banks. Lead lenders in the multibank syndicate are Bank of America, Deutsche Bank, Bank of Nova Scotia and Merrill Lynch.

Park Place executives will issue bonds later on the public debt market to refinance the acquisition.

The deal will give the Hilton Hotels Corp. gaming spinoff the most hotel rooms, the most casino space and the greatest cash flow level in the casino industry, with several major properties including Caesars Palace in Las Vegas.

Park Place also owns the Flamingo Hilton and Bally's on the same Flamingo Road intersection where Caesars is located. The acquisition means the corporation will control three of the four corners of the Las Vegas Strip's busiest intersection.

In addition to Caesars Palace, Park Place is acquiring Caesars Palace-Lake Tahoe; Caesars Atlantic City; a casino in Tunica, Miss.; an Indiana riverboat; and a 50 percent share of a Windsor, Ontario, casino that it will co-own with Hilton Hotels Corp.