Houston Billionaire Tilman Fertitta Buys Caesars Stock

(Bloomberg) -- Tilman Fertitta, the Houston real estate mogul who last year proposed merging his casino and restaurant empire with Caesars Entertainment Corp., has become an investor in the Las Vegas company, according to a person familiar with the situation.

Fertitta bought about 4 million Caesars shares, less than 1 percent of the total, because he thinks the company is undervalued, according to the person, who asked not to be identified because he wasn’t authorized to speak publicly. Fertitta remains interested in a possible combination with Caesars, but he hasn’t proposed one again.

Caesars, one of the largest owners of casinos in the U.S., is still coping with the fallout of a $30 billion leveraged buyout 11 years ago. The company put its largest unit in bankruptcy in 2015. And a restructuring left Caesars with an ownership base that includes distressed debt investors and hedge funds, as well as its original private equity firms, Apollo Global Management and TPG.

Chief Executive Officer Mark Frissora is scheduled to step down this year, a move that could set the stage for a deal.

Investor Carl Icahn is pushing for a sale of Caesars after amassing a 10 percent stake plus an additional 10 percent economic interest through swaps, said a person familiar with the matter who asked not to be identified because it wasn’t public.

A representative for Icahn didn’t respond to a request for comment.

Eldorado Resorts Inc. also approached Caesars about a deal, the Wall Street Journal has reported.

Fertitta owns closely held Landry’s Inc., whose businesses include the Golden Nugget casinos and the namesake seafood chain.

To contact the reporters on this story: Christopher Palmeri in Los Angeles at cpalmeri1@bloomberg.net;Scott Deveau in New York at sdeveau2@bloomberg.net

To contact the editors responsible for this story: Nick Turner at nturner7@bloomberg.net, ;Elizabeth Fournier at efournier5@bloomberg.net, Michael Hytha

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