IGC Agrees To Extend The Deadline For Selling Horseshoe Hammond

Article by : Helen Dec 9, 2020

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As announced earlier this summer, Eldorado Resorts and Caesars Entertainment, 2 of the biggest American casino entertainment companies, were merged and became a single huge corporation named Caesars. However, before this happened, the companies had been through a rough patch. One of the obstacles that occurred on their way was a major concern of the Indiana Gaming Commission (IGC) about the increased power of newly-formed corporations in the state. The gambling regulator did agree to approve the deal, but only if several gambling venues would be put up for sale.

Tropicana Evansville, Caesars Southern Indiana, and Horseshoe Hammond were considered three venues that were about to be sold. The clock started ticking for the contract to be concluded, and the timeline was pretty limited. To not waste time waiting for the buyers to be found, the IGC greenlighted the merging process of the 2 companies with the caveat that the deal could be still canceled if those three casinos wouldn’t be sold within the given timeframes. At first, Caesars wanted to agree to sell just 2 of its properties, but the gambling regulator insisted on keeping its initial decision.

In fact, it wasn’t a big challenge for Ceasars to find buyers for the Tropicana Evansville and Caesars Southern Indiana properties, considering their relatively small sizes and prices. Thus, Twin River Worldwide Holdings has already purchased Tropicana Evansville, and the Eastern Bank of Cherokee Indians is about to make final steps to become the new owner of the Caesars Southern Indiana venue. The last item that should be done to make the regulatory body satisfied is to sell Horseshoe Hammond. However, this turned out to be a much more difficult task.

Horseshoe Hammond is the largest casino in the state, and it has the biggest annual revenue among all Indiana gambling properties. According to the IGC annual report, the casino generated a revenue of US$309 million over the fiscal year, which is US$85 million more than the revenue reported by Indiana Grand – the second largest casino in Indiana. Horseshoe features more than 2,200 gambling machines and tables that are enough to accommodate around 1,100 visitors at once. Considering the current pandemic situation, it is not that easy to find a potential buyer that quickly. The IGC representatives admitted that selling the gambling venue “presents unique challenges” in times when the entire gambling industry is suffering from COVID-19.

Granting relief regarding divestiture timing is in the best interest of the state and local community, and will not negatively impact operations at the property.

In addition to concerns related to the coronavirus, Caesars officials are also worried about a sudden gambling expansion in Illinois, a neighboring state. This tendency is mostly felt in Chicago located approximately only two and a half hours away from Hammond, making the Horseshoe Hammond less attractive for the investors and buyers. That’s why the casino officials believe that they need 18 months more to be able to sell their property. Understanding the complexity of the current economic situation, the IGC agreed to extend the deadline to the end of 2021.

Caesars is planning to retain the Indiana Grand and Hoosier Park properties that are the only two casinos located less than 1 hour away from Indianapolis. This year, the local authorities gave a green light for the two properties to offer table games. Caesars wants to inject around US$60 million to add more table and card games to both gambling venues.