Tag Archive : Crisis

Covid-19 Crisis Pushes Caesars-Eldorado Merger to June

The coronavirus pandemic and its impact on the travel, gaming, and hospitality industries has delayed the $17.3 billion merger of casino operators Caesars Entertainment Corp. and Eldorado Resorts and it is now due to close in June.

A source with firsthand knowledge of the matter told CNBC that the deal is definitely moving forward, despite reports from recent weeks that the unfolding global Covid-19 crisis could derail the mega-merger.

The transaction needs approval from gaming regulators in states where Caesars and Eldorado operate properties.

However, the coronavirus stormed through the US casino and hospitality sectors in an unprecedented manner, grinding commercial casino operations to a halt and forcing regulatory bodies to put the $17.3 billion merger on the back burner.

Reports emerged over the past several weeks that the coronavirus crisis could change the way regulators view the massive debt that goes along with the Caesars-Eldorado combination and eventually derail the deal.

Caesars and Eldorado await approval from Indiana, Nevada, and New Jersey regulators. The Federal Trade Commission also needs to sign off on the merger.

Nevada Still Investigating

Nevada Gaming Control Board Chair Tony Alamo said that the regulator is still investigating the deal and that it “is going like any other merger […] it’s just going through the process, which includes a normal investigation.”

Caesars and Eldorado previously expected to close the deal by mid-April, but according to multiple sources, this is now likely to happen in June.

The Nevada Gaming Control Board’s next meeting is scheduled to take place in April. In New Jersey, the state Casino Control Commission is likely to hold its next meeting on May 13.

Caesars, Eldorado Have Enough Liquidity amid Coronavirus Pandemic

A highly placed source told CNBC that both casino operators have enough liquidity to last for well over a year, even though their properties across North America are currently closed and will remain closed for unspecified time.

According to the source, Caesars currently has $3 billion on its balance sheet. The recent sale of its Rio All-Suite Hotel and Casino property in Las Vegas for $460 million provided the company with additional cash.

If Eldorado closes a $230 million sale of two casinos in Mississippi and Missouri to Twin River Worldwide Holdings in the coming two months, it would head into the Caesars combination with $850 million on hand.

The highly placed CNBC source said that “the deal was constructed with a balance sheet to survive a crisis, with ample liquidity and no debt maturities until 2024.”

In addition, Eldorado and Caesars have secured firm financing commitment from 11 banks and intend to close the deal as it is, because any changes could require a new shareholder vote and a renewed effort at procuring financing.

The two companies’ shareholders approved the combination late last year.

Eldorado is currently paying a ticking fee of $2.3 million a day to Caesars shareholders for failing to close the deal within a nine-month period after it was first announced. A late June closure would raise the merger’s price tag to $17.5 billion.

According to insiders, the ticking fee is considered rather insignificant given the size of the deal and the anticipated benefits both companies would reap.

Some Caesars Properties Start Taking Reservations

On March 17, Nevada Governor Steve Sisolak ordered a statewide 30-day casino shutdown as part of a set of measures imposed to curb the spread of the coronavirus. The dangerous virus is ranging on across the US and the rest of the world, but some Caesars properties in Nevada have begun taking reservations.

The company’s Flamingo Las Vegas property tweeted last night that they are “currently taking reservations for April 17th and beyond, but the situation remains fluid.” The tweet read further that “Caesars Entertainment will monitor the evolving situation and work with our local officials on a confirmed reopening date.”

Source: Caesars-Eldorado merger moving forward

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BlockApps Collab with Optimum to Address Energy Crisis Amid COVID-19

As per the latest reports, Blockchain as a Service company BlockApps has collaborated with software consultancy firm Optimum. As a part of this partnership, BlockApps and Optimum will build a blockchain platform for tracking energy usage. 

About BlockApps and Optimum

Optimum is involved in the oil and gas, manufacturing and construction industries. On the other hand, BlockApps is the developer of a cloud-agnostic blockchain platform, named STRATO. Both of these firms will be working together to develop and implement various application integrations for STRATO. 

BlockApps and Optimum acknowledged the extreme crisis in the global energy industry, owing to the diminishing oil sector and relevant supply chains causing economic imbalance amid the COVID-19 outbreak. 

Goals

Optimum clarified that it aims to use BlockApps’ STRATO platform to address the challenges in the oil and gas, manufacturing and construction sectors by harnessing blockchain technology. 

As of now, the US crude oil prices are at an all-time low and the industry is facing an extreme supply and storage reserve shortage due to a massive downfall in global demand. 

Other Partnerships

Last year BlockApps collaborated with the agricultural wing of pharmaceutical and life science company Bayer AG to execute a series of blockchain initiatives. Moreover, BlockApps is continuously integrating its offerings with cloud services like Azure, Amazon Web Services, and Google Cloud Platform.  

Penn National Sells Vegas Casino, Lays Off Staff amid Covid-19 Crisis

Casino operator Penn National Gaming announced on Friday the sale of Tropicana Las Vegas to its real estate investment trust Gaming and Leisure Properties Inc. to keep the business healthy amid the unfolding coronavirus crisis.

Penn National confirmed the sale of the Strip hotel and casino resort, which first opened doors in the 1950s, just a couple of months after reports emerged that the regional gaming and hospitality operator had accepted an unsolicited offer for the 1,400-room property that valued it at around $700 million.

Penn National also said that it is set to furlough 26,000 employees as all of its 41 casinos and racetracks around the US are closed as part of a number of measures invoked by federal and state governments to help contain the spread of the coronavirus.

Several states have extended the temporary closure orders affecting all non-essential businesses and other states are expected to soon follow suit.

Tropicana Las Vegas Gets New Owner

Penn National announced that it has agreed to sell the iconic Las Vegas Strip property to Gaming and Leisure Properties, the REIT that was spun off from the casino operator in 2013.

The transaction includes the Tropicana Las Vegas real estate assets as well as a new ground lease for Penn National’s planned mini-casino in Morgantown, Pennsylvania in exchange for $337.5 million in rent credits.

The deal also provides Penn National with the opportunity to acquire the operations of Gaming and Leisure Properties’ Hollywood Casino in Perryville, Maryland at some point in future.

The casino operator said that the transaction will help them “relieve liquidity pressure in terms of rent obligations”, but also noted that it is further committed to “taking further steps to reduce our ongoing operating expenses in order to ensure we have a healthy business to return to when we are able to re-open our doors.”

It should be noted that Penn National will continue to operate Tropicana Las Vegas after the sale.

During Penn National’s third-quarter earnings call last fall, the company’s President and CEO Jay Snowden said that they had received several unsolicited bids for the Strip resort and that they were evaluating those.

Mr. Snowden pointed out that a sale was not imminent at the time. However, they were encouraged by some of the conversations that had taken place and some of the bids they had received.

Penn National Furloughs 26,000 Casino Workers amid Covid-19 Crisis

The operator said Friday that it will place approximately 26,000 employees on unpaid furlough beginning April 1. The company previously announced that it would pay its team members their full wages and benefits through the end of March.

Penn National will maintain medical benefits to those furloughed employees who are enrolled in its health plans through June 30.

In a letter to team members, Mr. Snowden said that the decision that affects the company’s nearly entire workforce “was extremely difficult to make” but the company is “motivated and focused” on reopening its properties around the nation as soon it is “safe and legal to do so.”

With more than 100,000 confirmed coronavirus cases, the US is the worst affected country in the world. The nation has tallied more than 1,700 deaths from the dangerous virus.

Source: Penn National Gaming Announces Additional Mitigation Efforts in Response to COVID-19 Pandemic

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Blockchain-based Jobs Rise by 3% Amid COVID-19 Crisis

The COVID-19 outbreak has left the global economy in turmoil. Despite the injection of trillions of dollars into the economy, the situation is sensitive as of now. Countries like India and the US have hit their highest unemployment rate in history. However, the blockchain industry seems to be in a separate league altogether. 

Blockchain-based Jobs are Rising

According to the reports from Indeed.com, there were approximately 114.5 million blockchain-based jobs globally in December 2019. The world has literally been shaken since then with the coronavirus outbreak. Almost all industry sectors have taken a hit and have responded with salary cuts, if not job cuts. Interestingly, blockchain-oriented jobs have increased across the world in the same time period. According to reports, jobs in the blockchain industry stood at $118.4 million in February, which is 3% more as compared to December last year. 

In fact, as per a report, blockchain expertise is the most in-demand skill of 2020 apart from cloud computing, analytical reasoning, and artificial intelligence

Blockchain Industry Amid COVID-19

Experts in the blockchain industry are quite optimistic about the future of crypto. Some believe that once crypto decouples from the traditional stock, it will grow in value immensely after a slight dip initially. The general opinion in this space is that crypto will recover and be a viable alternative to the traditional finance market soon.  

BitMEX CEO Arthur Hayes commented a few days ago, “BTC will hit the $20K mark by the end of 2020.”

On the other hand, Jihan Wu, founder of Bitman commented, “There are two reasons: first, from China and its neighboring countries experiences, coronavirus can be obtained and taken under control in about 2 months. Secondly, countries around the world are adopting great quantitative easing monetary policies.”

On the other hand, Tyler Winklevoss, co-founder of the Gemini cryptocurrency exchange is of the opinion that Bitcoin is the only resistance to the money printing disease in today’s economic recession. 

Golden Nugget Owner Lays Off 40,000 Workers amid Covid-19 Crisis

Billionaire businessman Tilman Fertitta has furloughed around 40,000 workers at his chains of casinos and restaurants in the wake of widespread temporary closures of non-essential businesses across the US in response to the global Covid-19 crisis.

Mr. Fertitta’s business assets include the Golden Nugget chain of casinos and hundreds of dining outlets operating under the Landry’s Inc. umbrella. The businessman said that he had to temporarily lay off staff to reduce the financial impact of government-invoked measures aiming to arrest the spread of the dangerous coronavirus.

The Texas-born billionaire has also called on authorities to allow dining and hospitality facilities to reopen at limited capacity in several weeks from now to avoid what could be one of the worst economic disasters in US history.

In a recent interview with Bloomberg, Mr. Fertitta said that while he supports the nationwide shutdown of businesses in the face of the Covid-19 outbreak, he thinks that “in a few weeks people will need to be around people” and that “otherwise we are going to go into an economic crisis that is going to take us years to dig ourselves out of.”

According to the billionaire businessman, who aside from his gaming and hospitality empire also owns NBA franchise Houston Rockets, casinos and restaurants could be allowed to operate at 30%-40% capacity to mitigate the economic impact of the current restrictions and to make sure that companies remain in business.

70% of Staff Temporarily Laid Off

Mr. Fertitta told Bloomberg that they had to place 70% of their staff on furlough as a result from the closure of most of the businesses owned by him.

The businessman is not the only casino owner to have furloughed employees in the wake of the coronavirus pandemic. Las Vegas casino giant MGM Resorts International laid off a number of employees following the closure of all of its US properties.

And as reported by Casino News Daily, the owners of Connecticut’s two casinos have placed their employees on furlough for the duration of the closure period.

Of the financial state of his businesses, Mr. Fertitta told Bloomberg said that he is confident these have access to enough cash to survive the current situation. Yet, the businessman said that he has been in talks with banks about potentially raising about $200 million in additional liquidity “as a little bit of insurance.”

Mr. Fertitta also noted that he is considering buying back Golden Nugget’s debt when things begin to turn back to normal and that he sees the move as great opportunity.

At present, the businessman’s Golden Nugget casinos in Las Vegas, Atlantic City, Lake Charles (Louisiana), and Biloxi (Mississippi) are temporarily shut down as are most of his restaurants. Those of his dining outlets that remain operational offer take-out and bring about 4%-5% of what they do when it is business as usual.

Mr. Fertitta noted that his gaming and hospitality businesses are burning through millions of dollars every day and that they are doing “basically no business.” The billionaire businessman noted that he wants to hire every furloughed employee back but “we have to survive or there is no company.”

Source: Billionaire Fertitta Furloughs 40,000 Workers at Casino, Restaurant Empire

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Can marijuana dispensaries stay open during Colorado’s coronavirus crisis? It depends.

Colorado Gov. Jared Polis deemed marijuana dispensaries “critical” retail businesses in an executive order Sunday urging employers to reduce their in-person workforces, meaning they would stay open if other industries were forced to shutter to mitigate the spread of coronavirus.

The governor’s order, however, will change how dispensaries do business. In-person sales are limited to medical patients only; recreational customers must order in advance for curbside pickup. The order is in effect from 8 p.m. on Tuesday until April 11, unless extended by the governor.

Some counties classified dispensaries among essential services allowed to remain open during the pandemic independent of the governor’s order. For example, in San Miguel County, which mandated residents shelter in place on March 18, dispensaries are open to fill pickup orders only.

Read the rest of this story on DenverPost.com.

Crown Shuts Melbourne Casino amid Covid-19 Crisis

Australian casino operator Crown Resorts was forced to close temporarily the main gaming floor at its flagship casino in Melbourne after it was stripped of its exemption from rules adopted across the state of Victoria to contain the spread of the coronavirus.

While many non-essential business across Victoria were ordered to shutter in the face of the global Covid-19 crisis, Crown was granted by the state’s government an exemption from social distancing rules. The move caused quite the controversy.

Crown’s Melbourne casino was allowed to continue to operate as long as it made sure to limit indoor gatherings to no more than 100 people. The major casino deactivated every second slot machine (or poker machine as they are called Down Under) and limited attendance numbers at its restaurants, bars, and other facilities to avoid large gatherings of people.

Victoria Premier Daniel Andrews announced on Saturday that Crown’s exemption has been revoked and the casino was ordered to close its main gaming floor. The state’s top official said that they were not confident that “the measures that were in place and were appropriate are appropriate now.”

Only the main gaming floor at Crown Melbourne would close temporarily. Smaller gambling rooms will remain open, it became known.

Gambling Amid Pandemic

Crown’s exemption from the social distancing rules implemented across Victoria was heavily protested by health experts who argued that the Melbourne casino should have been ordered to play by the same rules as everyone else as Victoria, just as the rest of the world, struggles to curb the spread of the dangerous virus that has gripped every single contour of society.

Pressure over Crown keeping its Melbourne casino open escalated this week after widespread closures of gambling facilities were announced all over the world, including Las Vegas.

Many casino operators running properties on the Las Vegas Strip, such as Wynn Resorts and MGM Resorts International, announced earlier this week that they would close these in response to the Covid-19 pandemic.

Later, Nevada Governor Steve Sisolak ordered the closure of all gaming properties across the state as part of a larger package of measures aiming to help contain the spread of the coronavirus.

Australian public health officials have been urging governments in every state and territory to take specific measures addressing gambling establishments that have poker machines as these often attract older people who are considered to be at a greater risk from Covid-19.

The closure of Crown Melbourne is expected to have a huge impact on Victoria’s economy as the hotel and casino complex is the state’s largest private-sector, single-site employer with more than 12,500 employees.

Crown is also a big revenue contributor. The property paid more than A$238 million in taxes to Victoria in the last financial year.

The number of coronavirus cases in Victoria reached 229 today after 51 new cases were recorded overnight. Nationwide, the tally of Covid-19 cases reached 1,072 on Saturday.

Source: Crown to shut gaming floor after losing social distancing exemption

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Flutter to Severely Chastise Affiliates Looking to Profit from Covid-19 Crisis

Being stuck in the middle of a pandemic of a virus that we don’t know much about and that has gripped every contour of society is discomforting, to say the least.

Yet, in the face of an unprecedented situation, the general tone of things has for once been “we’re all in this together”, which kind of gives hope that Covid-19 could soon be brought under control.

Irish gambling operator Flutter Entertainment (formerly Paddy Power Betfair) has often landed in hot water for its tongue-in-cheek advertising campaigns. However, the company revealed that it has taken steps to prevent its affiliates and third-party advertising partners from taking advantage of the global coronavirus crisis and use “current events in an opportunistic manner.”

Flutter, which manages the Paddy Power and Betfair gambling brands, among others, this week distributed a message to its affiliate partners titled Coronavirus and Marketing, warning them to follow the company’s marketing guidelines and code of conduct amid the Covid-19 outbreak.

The message reads:

“Partners are not allowed to reference coronavirus in any marketing materials when promoting PPB (Paddy Power Betfair) brands. We will have zero tolerance on this type of activity and partners will be suspended immediately.”

Warning Amid Widespread Cancellation/Postponement of Sporting Events

Flutter’s warning emerges as the sports betting industry is preparing for unprecedented losses as there are practically no major events sports enthusiasts can wager on.

A number of sporting events around have been canceled or postponed globally in recent weeks in response to the Covid-19 crisis and as the world is fighting to contain the spread of the dangerous virus.

There are nearly 250,000 known coronavirus cases around the world and the number of deaths passed the 10,000 mark. Numbers continue to rise steeply despite global efforts to contain the outbreak.

Flutter said earlier this week that the unfolding crisis and the impact Covid-19 has on the global sports calendar would have massive impact on its 2020 financial performance. In a market update, the gambling operator said that it expects its full-year EBITDA to be reduced by £90-£100 million, or even more, due to the cancellation/postponement of big sporting events.

Flutter’s estimate included the cancellation of Euro 2020, even though UEFA’s announcement that it would postpone the football championship to 2021 was made a few days after the gambling operator updated the market on how badly it expects to be affected by the Covid-19 crisis.

Flutter is in the middle of a multi-billion tie-up with Canadian gambling giant The Stars Group. The deal was expected to close in the second or third quarter of the year. However, it is yet to be seen whether the coronavirus outbreak would affect that timeframe.

Source: PADDY POWER BETFAIR TAKE FIRM STANCE ON ‘CORONAVIRUS MARKETING’

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Genting Closes Malaysia Casino Resort in Response to Covid-19 Crisis

Genting Group’s Resorts World Genting property will temporarily close all its operations effective tomorrow, March 18, news emerged earlier today.

The integrated resort that is located in the Genting Highlands near the Malaysian capital Kuala Lumpur will remain shuttered until March 31.

News that operations at the property would be temporarily suspended emerge shortly after Malaysian Prime Minister Tan Sri Muhyiddin Yassin issued a movement control order in the face of the global coronavirus crisis.

According to a message on Genting Malaysia’s official website, the pending closure includes Resorts World Genting’s hotels, casino, food and beverage facilities, entertainment venues, shopping malls and retail outlets, the Skytropolis Indoor Theme Park, and other attractions.

The gaming and hospitality operator said that operations at its resort will resume on April 1.

The company’s message from Monday read that all hotel reservations made for the closure period will be canceled and that “guests may seek a refund or change their reservation dates.” The same applies to all reservations made at Genting Malaysia’s Resorts World Awana, Resorts World Kijal, and Resorts World Langkawi properties.

Guests who have bought tickets for any of the attractions offered at Resorts World Genting or for any scheduled shows will, too, be refunded.

Essential Services to Remain Operational During the Closure Period

Genting Malaysia said that all essential services across its resort would remain operational during the two-week closure period. These include security, utilities, and clinics.

As mentioned earlier, news about the closure of Resorts World Genting emerge just a day after Malaysia’s Prime Minister ordered the implementation of strict travel restrictions as the country grapples with the coronavirus spread.

With more than 550 confirmed Covid-19 cases as of Monday, Malaysia is one of the worst affected countries in Southeast Asia.

Overseas citizens are prohibited from entering the country and nationals are prohibited from leaving Malaysia and traveling overseas. All business premises are set to close except markets and shops that supply products for residents’ daily needs.

People are also required to maintain social distance to help limit the spread of the dangerous virus and their movement is heavily restricted. Schools and other institutions are, too, ordered to close.

Prime Minister Muhyiddin Yassin said in a Monday address to his people “the current situation of this outbreak requires drastic measures to restore the situation as soon as possible.”

Aside from its resort in its homeland, Genting Group has also closed some of its properties in other countries in response to the global coronavirus crisis. The company’s Resorts World Manila propery was shuttered on Sunday after the Philippine gambling regulator, PAGCOR, ordered the temporary closure of all casino resorts and other gaming facilities.

Source: Resorts World Genting ops, casino to close temporarily amid govt’s movement control order

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