It appears that Caesars Entertainment is close to sealing the deal for its interactive unit.
U.S. gaming holding company Caesars Acquisition Co (CAC) is reportedly in “exclusive talks” with a Chinese consortium over the possible sale of Caesars Interactive Entertainment’s (CIE) online games business.
People familiar with the matter told Reuters the struggling casino operator granted the consortium, which includes online games developer Giant Interactive Group, “a short exclusivity period earlier this week, following an auction that also included U.S. toymaker Hasbro Inc and South Korean mobile game company Netmarble Games.”
In May, reports surfaced that Caesars Entertainment has been mulling to sell the interactive games unit, even though it’s one of the few branches of the Caesars family tree that actually makes money. In 2015, CIE’s casino-themed online games division reported a 23 percent rise—to reach $766 million—in annual revenues.
The bids for the online games unit are valued at more than $4.2 billion. The interactive division, which bought Playtika in 2011, is separate from Caesars’ real-money online gambling operation and the World Series of Poker brand.
Netmarble Games made a play in early June to purchase Israel-based Playtika from Caesars Entertainment. Korean media outlets reported the mobile games company was prepared to pay between US$3.4 billion to US$4.3 billion for Playtika, whose assets can be easily absorbed into Netmarble’s existing business without having to go apply for gambling licenses in different markets.
If it pushes through, the sale will pump the much-needed cash into a new group that will be created one CAC and Caesars Entertainment Corp. (CEC) merges. CEC, if you recall, is still wrestling with its attempts to restructure its bankrupt main unit, Caesars Entertainment Operating Co (CEOC), from which CIE was spun off pre-bankruptcy. CEOC’s creditors, however, are insisting CEC should be forced to contribute billions more to the restructuring than CEC has offered to date.