Activist investor Carl Icahn again raised his stake in Caesars Entertainment on Monday and is likely to push for a sale of the operator, though Las Vegas Sands is the only one with the funds for a cash-based takeover, Bernstein Research said.
Icahn first disclosed he had built a stake in February and has further increased his holding to 17.5%. He also now controls three board seats, or 25% of the total.
“Las Vegas Sands is likely the only operator to be able to acquire Caesars purely for cash consideration,” Bernstein said in a note. “Wynn or MGM could likely do a mix of consideration, while smaller players like Eldorado and Penn National have no liquidity and are already highly levered and would be doing a reverse merger for stock,” it said.
Bernstein warned any sale of Caesars is unlikely to be cheap, while the benefits would be murky.
The research firm also points out that Sands, Wynn, and MGM are all bidding for an IR license in Japan and are unlikely to want to buy Caesars, which would increase their already substantial exposure to the US market. (AGB)