Plans to Reconstruct the Hotel to Resemble a Traditional Lake
Tahoe Lodge with With One of the World's
Largest Indoor Water Parks
|LAS VEGAS - May 11, 2005 -- Caesars Entertainment, Inc. (NYSE: CZR)
today announced that it has entered into a definitive agreement to sell
its Reno Hilton casino resort to Grand Sierra Resort Corp., a Nevada-based
hotel and resort developer, for approximately $150 million.
The transaction is expected to close by the end of the fourth quarter of 2005 and is subject to customary regulatory approvals and closing conditions outlined in the purchase agreement.
With nearly 2,000 rooms, ten restaurants, 200,000 square feet of convention space, a world-class dinner theater and 107,000 square feet of gaming space with more than 1,300 slot machines, the Reno Hilton is one of the premier casino resorts in Northern Nevada. Grand Sierra Resort Corp. plans to reconstruct the property to create the quintessential entertainment destination, which will include one of the world's largest indoor water parks. Upon approval of the Nevada Gaming Control Board and the Nevada Gaming Commission, Larry Woolf, former chief executive officer and chairman of MGM Grand Hotel, Las Vegas, will lease the property's gaming operations from Grand Sierra Resort Corp.
"We have some very exciting plans for the Reno Hilton, which I believe
is one of the most exceptional properties in Nevada," said Thomas J. Schrade,
president of Grand Sierra Resort Corp. "We will disclose further details
of those plans as we move forward. Right now, we simply want to say that
we are looking forward to working very closely with the people and public
officials of Reno to develop an extraordinary resort that will create significant
economic benefits for the community."
Under the terms of the agreement, Grand Sierra Resort Corp. will purchase certain assets of the Reno Hilton and will assume certain related current liabilities. In addition, a subsidiary of the Navegante Group will purchase certain of the gaming assets of the Reno Hilton from Caesars Entertainment and will assume certain gaming-related current liabilities.
Pending regulatory approval, the Navegante Group will operate the casino at the Reno Hilton pursuant to a casino lease agreement with Grand Sierra. The aggregate consideration may be adjusted for changes in net working capital. Oppenheimer & Company is the exclusive financial advisor to Grand Sierra Resort Corp. Caesars Entertainment was represented by CB Richard Ellis on the transaction.
About Grand Sierra Resort Corp.
About Caesars Entertainment
The company's Board of Directors in July 2004 accepted an offer from Harrah's Entertainment, Inc. to acquire the company for approximately $1.9 billion in cash and 67.9 million shares of Harrah's common stock. Shareholders of both companies approved the merger in separate meetings on March 11, 2005. The transaction is contingent on approval by federal and state regulatory agencies and is expected to close in the second quarter of 2005.
This document includes "forward-looking statements" intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995.
|Also See:||Faced with Two Years of Declining Visitors and Shrinking Gaming Revenues, Reno Works to Broaden Appeal / Feb 2003|
|Owners Ally and Amin Visram Renovate and Reopen the Former Flamingo Hilton as the Golden Phoenix Hotel Casino / Dec 2002|