On Wednesday, the New Jersey Casino Control Commission granted interim authority for Eldorado Resorts to own and operate Tropicana Casino & Resort in Atlantic City.
The Nevada-based company is assuming control of the Atlantic City property as part of the $1.85 billion sale of Tropicana Entertainment. Carl Icahn announced the deal in April after selling the Trump Taj Mahal to Hard Rock International months earlier.
Thomas Reeg, president of Eldorado Resorts, realizes the company has its work cut out for it considering the competitiveness of the market.
In a press release announcing the decision, Reeg said:
“We’re coming in eyes wide open that we’re going to have to fight for our position in this market. We expect a fight for market share and we’re prepared to get involved. We’re buying an asset that we hope is standing and competing 50, 100 years from now.”
A Tropicana sportsbook is on the radar
The company describes the Tropicana as being in “good physical condition.” That leaves officials to focus on building on the familiar brand in a saturated casino market.
A new sportsbook might just give Tropicana the boost it needs. The release of the latest NJ sports betting revenue figures are encouraging. It certainly provides an incentive for casinos to get in on the action.
Officials from the company are targeting October for the opening of the retail sportsbook. Both the company and the property recently signed deals with popular sportsbook operator, William Hill US.
The partnership will be critical to launching a sportsbook in such a short time.
“We’re not new to competition,” said Gary Carano, chairman and CEO of Eldorado. “Reno is as much if not more competitive. We will be able to compete favorably; we have in every market we’ve been in.”
Eldorado on the aggressive growth plan
Eldorado has been on a buying spree of late. The purchase of Tropicana Atlantic City was part of a package deal that included six other casinos in five states.
Prior to the purchase of Tropicana Entertainment, the company shelled out $1.75 billion for Isle of Capri Casinos. That particular acquisition added 12 casinos to the company’s portfolio.
Also, the company announced it plans to purchase Grand Victoria Casino in Elgin, Illinois, for $328 million in cash at about the same time it announced the Tropicana deal.
By all accounts, all this growth is a good thing, and it shows in the company’s stock price which doubled in the last year.
There might be some challenges ahead, however. Eldorado now has a lot of moving parts to manage.
In addition to integrating the Isle of Capri and Tropicana casinos into its portfolio, it plans to launch sports betting in New Jersey as mentioned above.
Eldorado properties also up for sale
The company has also shown an interest in selling some properties. It is currently selling its Pennsylvania property, Presque Isle Downs Casino, to Churchill Downs Inc.
Two other casinos have been on the auction block but have failed to change hands.
A buyer for the Isle of Capri Lake Charles in Louisiana failed to obtain a gaming license and had to walk away from the deal. And Churchill Downs Inc. walked away from buying a second property, Lady Luck Casino Vicksburg from Eldorado.
Eldorado playing with the big boys
Even with all those balls in the air, the acquisitions allow Eldorado to be competitive with gaming industry giants. As sports betting and NJ online gambling continue to expand across the country, Eldorado is positioning itself to take advantage of its growing presence.
For now, though, all eyes will be on the company as they take over the operations at Tropicana. According to the company, their timing couldn’t be better.
“We’re very excited to be here and operate in Atlantic City,” Carano said. “Atlantic City is on a roll, and we’re on the upside of that roll.”