The Real Deal New York

Will Caesars fold its Atlantic City casinos?

“All the businesses in A.C. are under tremendous pressure,” CEO says
May 08, 2014 01:40PM

One week after announcing a $1 million bid for a New York gaming license, casino operator Caesars Entertainment hinted at the possibility of closing properties in nearby Atlantic City, N.J.

One of the largest casino operators in the area, Caesars is reportedly on the hunt for ways to reduce capacity in a sluggish market.

“We are looking at all of our options to reduce the cost of doing business here,” Gary Loveman, Caesars’ CEO, said in a Wednesday conference call during which the company reported a first-quarter loss. “All the businesses in A.C. are under tremendous pressure.”

The casino operator owns four casinos in Atlantic City: Caesars, Bally’s, Harrah’s and Showboat — and has struggled to remain solvent during a period of weak consumer spending that followed a 2008 leveraged buyout that left the company $23 billion in debt, according to Bloomberg. The company closed the Atlantic Club, formerly the Atlantic City Hilton, in January.

“These markets can reach points when no new supply is indeed the right answer,” Loveman told Bloomberg. “In some cases, reducing supply is the right answer.” [Bloomberg and Crain’s]Julie Strickland