Caesars Entertainment to buy casino operator Centaur for $1.7 billion

The marquee sign at Caesars Palace hotel is seen on the strip in Las Vegas, Nevada, U.S. February 16, 2011. REUTERS/Steve Marcus/File Photo

(Reuters) - Casino operator Caesars Entertainment Corp CZR.O said on Thursday it would buy privately owned casino and horse racing company Centaur Holdings LLC for $1.7 billion in cash to expand in Indiana.

The deal comes about a month after Caesars’ main operating unit emerged out from a near three-year bankruptcy.

In recent years, the U.S. gambling industry has faced a shake-up as a result of the legalization of gaming in states that used to prohibit it. States that have recently opened themselves to casinos include Maine, Ohio, Kansas and Maryland.

Indianapolis-based Centaur has more than 6.5 million guests each year across its properties and serves more than 1.1 million members as part of its loyalty program, Caesars said.

Caesars said the offer included $1.63 billion at closing and $75 million in deferred consideration.

Following the deal, Caesars would add the Hoosier Park Racing & Casino and Indiana Grand Racing & Casino properties. The properties include more than 2,000 slot machines and table games, as well as dining outlets and horse racing tracks.

Reuters had reported in May, citing sources, that Centaur was exploring a sale.

Casino operators are also looking to increase their scale by consolidating, partly in response to a decline in revenue as gamblers age.

Reporting by Arunima Banerjee in Bengaluru; Editing by Shounak Dasgupta