Sale of Hoosier Park to Caesars
ANDERSON – Change could be coming soon to Hoosier Park Racing & Casino if a potential sale is approved.
Las Vegas-based Caesars Entertainment announced an agreement Thursday to purchase two Indiana casinos, Hoosier Park Racing & Casino in Anderson and Indiana Grand in Shelbyville, as well as three off-track betting locations in Indianapolis, New Haven and Clarksville.
Bloomberg News reported the sale to be worth more than $1 billion.
“We believe Caesars’ acquisition of Centaur Gaming will further build on the successes and contributions of the properties for the benefit of our customers, team members, horsemen, community partners, and financial stakeholders,” said Centaur Gaming Chairman and CEO Rod Ratcliff in a press release.
The sale is expected to close in the first half of 2018; however, the sale would be subject to approval by the Indiana Gaming Commission and the Indiana Horse Racing Commission. Both regulatory groups said they had not received notice about the reported sale ahead of Thursday’s release.
If approved, the purchase would make Caesars Entertainment owner of four of the state’s five largest casinos in terms of revenue. Centaur Gaming brought in $480 million in casino revenue last fiscal year from the Anderson and Shelbyville casinos.
“I am thankful for the hard work and dedication of Centaur Gaming’s team members and I’m confident that they will continue to make many valuable contributions with a company as strong and geographically diversified as Caesars,” said Ratcliff.
Caesars Entertainment already owns the state’s largest casino, Horseshoe Hammond, which brought in $450 million in gambling revenue last year and Horseshoe Southern Indiana, which ranks third with $248 million.
State law prohibits one company from owning more than two casinos in the state; however, that does not apply to racetrack-based casinos, which were authorized under a different Indiana statute, Jennifer Reske, deputy director of Indiana Gaming Commission, said.
Caesars Entertainment and Centaur Gaming would both have to provide documentation and information to IGC and IHRC so they could rule on the sale.
Edward Feigenbaum, publisher of weekly industry newsletter Indiana Gaming Insights, said if Caesars were to buy the two properties, it would mean the company would be responsible for more than 50 percent of all Indiana gaming revenue.
“There is certainly concern about overconcentration and potential leverage that one operator might have,” Feigenbaum said.
That’s exactly the reason the Indiana Legislature included the two-license per company restriction, he added.
“The two-license limit was the concern about one company having too much leverage and opportunity to have a little too much clout,” he said. “Essentially they could become too big to fail like we saw with banks in 2007 and 2008.”
But despite some reticence, the deal could be huge for Indiana gambling.
“In terms of big positive, Caesars is the world’s largest gaming company … they have got the ability to put out opportunity capital anywhere in the world,” he said.
He wagers it would also be a great move for Caesars.
“What Caesars could get out of this, all kinds of synergy that could cut their costs and increase profits,” he said. “They would have a string of casinos that stretches from essentially Chicago all the way to Louisville, with Indianapolis in between … they have an opportunity to invest in that whole I-65 and I-69 corridor.”
The sale comes at an opportune time for Indiana’s racinos. In October, Hoosier Park hosted the nation’s most prestigious harness racing championship, the Breeders Crown, which brought national spotlight to Madison County.
Also, legislation passed in 2015 would allow the owner of Hoosier Park and Indiana Grand to seek permission from the state to add table games, such as blackjack and poker, to their casinos starting in 2021.
The potential deal would be the first major deal for Caesars since it restructured more than $18 million in debts in 2015. Last month, Caesars restructured its debt in a deal that created Vici Properties Inc., a separately traded real estate investment trust.
Gaming revenue
If Caesar Entertainment purchases Centaur Gaming's two racing casinos, it would own four of the state's five largest casinos in terms of revenue:
• Horseshoe Hammond: $450 million
• Indiana Grand: $271 million.
• Horseshoe Southern Indiana: $248 million.
• Hoosier Park: $209 million.
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