Experts weigh in on speculation that MGM and Caesars Entertainment will merge – KLAS


LAS VEGAS – The two biggest hotel-casino giants on the Las Vegas Strip could soon become one.  There is speculation that MGM Resorts International and Caesars Entertainment could merge.

“If they did merge, they would have an overwhelming presence here in Las Vegas,” said David Schwartz, the director of the Center for Gaming Research at UNLV.

The New York Post was the first news agency to report the speculation surrounding the properties.  Sources close to the situation tell the New York Post MGM has hired an investment bank and a law firm to start exploring the area of a merger.

“I think these companies are always exploring their options through things like this,” Schwartz said. “They’re always looking at mergers and consolidations, so it’s not really surprising MGM would be considering this right now.”

Schwartz says the last big wave of mergers was back in 2005 when the then-called MGM Mirage merged with Mandalay Resort Group.

“We have seen some big deals in the past in Las Vegas, and this one would be no exception,” said Schwartz.

The MGM Resorts properties combined with the Caesars Entertainment properties is actually a pretty sizeable chunk of the Las Vegas Strip.  So, the impact of a merge could be far-reaching.

“If this merger did happen, then probably there would be pressure on other companies to merge, so we’ll probably see something of a ripple effect through the rest of the industry,” Schwartz said.

Both MGM Resorts International and Caesars Entertainment declined to comment, saying they don’t address rumors.

But that’s not stopping gaming research experts from speculating.

Schwartz says it’s unclear what benefit — if any — a merger would have on tourists staying at those properties.  With that said, one thing is clear: “The biggest impact locally would be just the sheer size of this company on the Strip,” Schwartz said.

Last week, Caesars CEO Mark Frissora stepped down after three years in that role.

Schwartz says that might have been a cue for MGM to look into a potential merger.

 

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