arrah’s will use the proceeds to finish its 660-room Octavius Tower at Caesars Las Vegas, develop the LINQ retail and entertainment area next to the Flamingo on the Las Vegas Strip, and invest in the potential joint-venture development of two Ohio casinos with Rock Gaming, the company said today in a U.S. regulatory filing.
Some of the money raised may also be used for another potential casino management and partial ownership opportunity, the company said without providing details.
The company, taken private in January 2008, is tapping public markets as a record slump in Las Vegas eases and casino securities rally. Las Vegas Strip gambling revenue jumped 21 % in August, Nevada’s Gaming Control Board said. MGM Resorts International last week raised us$ 511 million in proceeds from a share sale.
In June, John Paulson’s Paulson & Co. hedge fund agreed to acquire a 9.9 % equity stake in Harrah’s by exchanging bonds he bought at a discount. Paulson’s shares are also being listed with the IPO. Harrah’s earlier cut debt by offering creditors new bonds at a discount for their old notes, buying back other debt for less than face value and extending maturities on us$ 5.5 billion in loans.
Harrah’s us$ 3.3 billion of secured 10 % notes due in December 2018 rose 2 cents to 86.5 cents on the dollar, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The debt has risen from a low this year of 72.5 cents on the dollar on February 10, Trace data show.
Harrah’s “dusted off” plans to build the LINQ street of bars, restaurants, shops and entertainment between its Flamingo and O’Sheas casinos in Las Vegas, its home base, Chief Executive Officer Gary Loveman said in a June interview. The project, first envisioned in 2006, includes a giant Ferris wheel. Last year, Harrah’s delayed finishing construction of Octavius Tower, citing the weak economy and Vegas room demand.
In August, Harrah’s said it may invest in and run two Ohio casinos being developed by Dan Gilbert, founder and chairman of Quicken Loans Inc. Harrah’s would be a minority investor in a joint venture with Gilbert’s Rock Gaming to build downtown casinos in Cleveland and Cincinnati.
Leon Black’s Apollo Management and David Bonderman’s took Harrah’s private for us$ 30.7 billion, including debt and transaction costs, in January 2008.