caesars-to-put-itself-up-for-sale-this-week-report

This should be interesting;

https://www.thestreet.com/investing/caesars-to-put-itself-up-for-sale-this-week-report-14923757

Caesar carries 18 billion in debt....ouch

And just like that, Carl Icahn picks up $50 million dollars. How is his forcing the board to test the waters with no real intention of selling not equivalent to "Pump and Dump", or Elon Musk thinking aloud tweets that are considered illegal activities?

Quote: Ayecarumba

And just like that, Carl Icahn picks up $50 million dollars. How is his forcing the board to test the waters with no real intention of selling not equivalent to "Pump and Dump", or Elon Musk thinking aloud tweets that are considered illegal activities?

If they put it in play they might not be able to stop it. Happened to Ross Johnson.

If what you were alleging were true it would be insider trading.

But for starters there's no evidence, in the article at least, of a timely sale.

Well, we posted the stuff last month about Icahn buying in. He forced his people onto the board and is making his move. Once he was forced to reveal his ownership stake (6%? iDK) He then grabbed it up to 15% within a couple days to get control. It's how he has done it before.

His whole MO has been to break off and sell what's profitable bits and leave the rest ska-ROOOD! 40+ years now of that crap. The airline industry never recovered.

Not a fan. Hard times are coming for CET people.

Icahn and CETs management deserve each other. May their partnership be interesting.

Quote: beachbumbabs

His whole MO has been to break off and sell what's profitable bits and leave the rest ska-ROOOD! 40+ years now of that crap. The airline industry never recovered.

He was a minor factor in the consolidation of the airline industry. That had to happen no matter who came along.

Maybe someone can help me understand. An 8.5 Billion Dollar company with $18 billion debt. Right? So more or less a $10 billion liability. Who would buy this unless they can resell for more?

there are so many pieces and leveraged claims that 'owner' may be irrelevant with all those having prior claims to the income stream.

Quote: beachbumbabs

Well, we posted the stuff last month about Icahn buying in. He forced his people onto the board and is making his move. Once he was forced to reveal his ownership stake (6%? iDK) He then grabbed it up to 15% within a couple days to get control. It's how he has done it before.

His whole MO has been to break off and sell what's profitable bits and leave the rest ska-ROOOD! 40+ years now of that crap. The airline industry never recovered.

Not a fan. Hard times are coming for CET people.

Babs, why do you believe the airline industry has not recovered?

Quote: DeMango

Maybe someone can help me understand. An 8.5 Billion Dollar company with $18 billion debt. Right? So more or less a $10 billion liability. Who would buy this unless they can resell for more?

If it's heavily leveraged, with a plan to cut expenses , getting banks to settle on the cheap, and selling off a few properties, it can be a nice addition to a portfolio. It all depends what exactly they are selling. As mentioned, the original CET has morphed into a many headed operation. Do they own the land or are they leasing? Is it part of the sale or do they have a real estate entity in place?
People will lose their jobs, values will drop , Icahn will screw someone and walk away up a couple hundred million.

Quote: DRich

Babs, why do you believe the airline industry has not recovered?

Breaking up an airline for the value of its equipment and gates while cancelling contracts, pensions, and jobs for thousands of people is a grenade into the heart of the system. And the effects ripple outward in time and industry.

The situation changes with no notice (on purpose) to employees and customers, vendors and peripheral operators. Service nationwide gets disrupted, hubs like St. Louis, Pittsburgh, Detroit go broke with no notice, communities lose their air service, passengers get stranded with no refund or cooperative rebooking, the whole industry gets cheapened and forced into economy measures that led us to where we are, squished, unfed, paying for the most ridiculous itemized services (charges for personal item, assigned seat, boarding priority, printing a freaking ticket? Are you kidding me? Bad enough when they started charging to check a bag.)

And no, LBOs and hostile mergers are not the ONLY reason air travel has become a sweaty armpit, stinky feet, pathetic imitation of a cattle car with wings. But it's a major contributor.

There are books. Many of them. I'm trying to keep it to a couple paragraphs. But there are a thousand small things that have added up to a huge loss in quality, civility, comfort, and contingency service, and a LOT of them are based in fear of corporate vulnerability to raiders.

Quote: DeMango

Maybe someone can help me understand. An 8.5 Billion Dollar company with $18 billion debt. Right? So more or less a $10 billion liability. Who would buy this unless they can resell for more?

No, more like $18 billion in assets and $10 billion in liabilities.

There might be way more value in the pieces. It was discussed here earlier that there was value in splitting off the land into an REIT. There may be other value in splitting off the higher end places like Caesars from the low end Flamingo and the like. What must be avoided is selling off the good parts to keep the bad. That happened to Eastern Airlines. Some of the good there was "sold" to internal sister companies, but the best part, the northeast shuttle. was sold off outright.

Eastern was dead in any case, but had they kept the good parts and been allowed to close off the bad they might have survived longer and even merged with a healthier airline.

Caesars seems to be so debt laden that it will take forever to get our from under.

Half of that debt will be written off, negotiated down or refinanced far into the future. Whatever happens going forward, the old Caesars is dead.

Quote: billryan

Half of that debt will be written off, negotiated down or refinanced far into the future. Whatever happens going forward, the old Caesars is dead.

Probably swapped for equity. Which the holders sell off, then it all starts all over again.

According to David McKee, LVA, debt stands at $23.6 billion!

Quote: DeMango

According to David McKee, LVA, debt stands at $23.6 billion!

Does he estimate what their land is worth?

The article says:

Including swaps, Icahn holds 28.5% of Caesars.

Icahn has been pressuring Caesar's board to find a strategic buyer to take over and help turn around the company, which emerged from bankruptcy in 2017. Fertitta reportedly circled back with Icahn last month in a second attempt to buy the struggling chain.

Caesars is valued at $5.6 billion on the Nasdaq stock market but carries some $18 billion in debt.

FWIW