Tags: Caesars Entertainment | Showboat | Casino | Atlantic City

Caesars Entertainment Closes Showboat Casino in Atlantic City

Friday, 27 Jun 2014 09:59 AM

Caesars Entertainment Corp. will shutter its Showboat property in Atlantic City as the largest operator of U.S. casinos reduces capacity in the east coast gambling hub amid persistent declines in revenue.

“We believe this is a necessary step to help stabilize our business in Atlantic City and support the viability of our remaining operations in the vicinity,” Chief Executive Officer Gary Loveman said in a statement, announcing the casino’s closure effective Aug. 31. “Since 2006, revenue in Atlantic City has declined by more than $3 billion and competition in the city has increased.”

Caesars, the largest operator of casinos in Atlantic City with four properties including the Showboat, has struggled to generate enough cash to service debt and last month reported a wider loss as revenue fell 1.9 percent. The company has sold assets, transferred properties between units, refinanced some borrowings and sold equity as part of efforts to repay debt taken on in the $30.7 billion leveraged buyout in 2008, led by Apollo Global Management LLC and TPG Capital.

Gambling revenue is declining in some of Caesars’ largest markets, such as Atlantic City and the U.S. midwest. The New Jersey city, which was overtaken by Pennsylvania as the second- biggest U.S. gambling hub in 2012, has attempted to lure all types of visitors to try their luck at its 11 casinos with properties offering promotions such as free stays and meals.

Casino Land

Loveman said last month that Caesars was looking for ways to reduce capacity in the struggling market in Atlantic City, including closing properties. The company has already taken steps to cut costs, such as reducing restaurant hours, a spokesman said at the time. In March, the company said it would close a property in Tunica, Mississippi.

The company didn’t give financial details of Showboat in today’s statement.

Caesars will remain the largest operator in Atlantic City after the closure of Showboat and will evaluate alternative uses of the property and land, it said. The company’s casinos in Atlantic City include the Caesars, Bally’s and Harrah’s.

Net loss in the first quarter widened to $386.4 million from $217.6 million a year earlier, Caesars reported last month. Revenue fell 1.9 percent to $2.1 billion.

Caesars acquired the Showboat casino by purchasing Showboat Inc. in June 1998.

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Caesars Entertainment Corp. will shutter its Showboat property in Atlantic City as the largest operator of U.S. casinos reduces capacity in the east coast gambling hub amid persistent declines in revenue.
Caesars Entertainment, Showboat, Casino, Atlantic City
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2014-59-27
Friday, 27 Jun 2014 09:59 AM
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