Harrah's could do IPO in 2013-2015, says CEO
NEW YORK (Reuters) - Harrah's Entertainment, which was taken private by TPG and Apollo Management in January 2008, could launch an initial public offering five to seven years from that buyout, Chief Executive Gary Loveman said on Monday.
Speaking at the Reuters Travel and Leisure Summit in New York, Loveman said the 2013 to 2015 timeline is speculation on his part, adding the casino operator has had no talks with TPG and Apollo on an exit timeline yet.
"It's certainly hard to speculate, but five to seven is still a comfortable notion," Loveman said. The private equity firms bought Harrah's, which operates 53 casinos in six countries, for $31 billion in a leveraged buyout that doubled Harrah's debt.
With $19 billion of debt, Harrah's has one of the highest debt loads in the gaming industry. The company has $5.8 billion of debt coming due in 2013, the five-year mark at which it could go public. Loveman said there is a good chance Harrah's would be able to get that extended.
He also said Harrah's return to the public market would likely be in stages. "What one might imagine is that the company would gradually make available some sort of public offering of its equity with a limited float and gradually work its way back to a more public position," he said.
"Nobody IPOs a $30 billion company in one fell swoop," he added.
ECONOMIC RECOVERY, ONLINE POKER
Many casinos are struggling with large debt burdens and limited access to the credit markets, and facing declining cash flows as consumers tighten purse strings in a weak economy.
Loveman said Harrah's would have to wait for the economy to recover before it can go public again. "Clearly you'd want to have business in a better position than today," he said.
Loveman also said the legalization of online poker in the United States would be another development the owners would like to wait for. "If we can make progress on that, and we saw some macroeconomic improvement, those would be favorable trends," he said.
Still, Loveman is in no hurry for an IPO. "You don't have to listen to people ask you, 'Did it rain last week in Atlantic City?'" he said, referring to investor calls and analyst notes.
"All these type of questions are just serving a community of people that are buying and selling the security hourly. As the CEO, it shouldn't be of interest."
Loveman said he would be happy for the company to remain private as long as he served as chief executive.
"I don't miss that at all," he said, referring to being public. If I never did it again, I wouldn't miss it."
(Reporting by Jui Chakravorty;
Additional reporting by Ernest Scheyder and Karen Jacobs: Editing by Phil Berlowitz)
(Reporting by Jui Chakravorty; Editing by Steve Orlofsky, Phil Berlowitz)
- Dallas Ebola patient vomited outside apartment on way to hospital |
- Islamic State committing 'staggering' crimes in Iraq: U.N. report
- Hong Kong police warn protesters against occupying buildings |
- Israel's Netanyahu to Obama: Don't allow Iran deal that leaves it at nuclear threshold
- Islamic State presses assault on Syrian border town, Kurds warn Turkey |