Under the terms of the agreement, Caesars will continue to operate the property pursuant to a lease for a minimum of two years and pay annualized rent of US$45m. The Buyer has the option to pay Caesars US$7 million to extend the lease under similar terms for a third year. At the end of the lease term and at the request of the Buyer, Caesars may continue to manage Rio or may provide transition services to the Buyer.
“This deal allows Caesars Entertainment to focus our resources on strengthening our attractive portfolio of recently renovated Strip properties and is expected to result in incremental EBITDA at those properties,” said Tony Rodio, CEO of Caesars Entertainment.
“The retention of the World Series of Poker and retention of Caesars Rewards customers are all factors that make this a valuable transaction for Caesars,” Rodio added.
The agreement allows for co-ownership of Rio-specific guest data and places no restrictions on Caesars’ marketing activities. The Rio will continue to be part of the Caesars Rewards network during the lease term, and the transaction is not expected to result in any changes to the guest experience.
The World Series of Poker will be hosted at the Rio in 2020 and hosting rights will remain with Caesars Entertainment thereafter.
Source. GMB
