FORMERLY PE OWNED
Caesars Entertainment
Includes Harrah's Entertainment, Caesars Palace
Casino / Hospitality · Reno, NV
- PE Firm
- Apollo Global Management / TPG Capital
- Year Acquired
- 2008
Apollo and TPG bought a casino empire for $31 billion, extracted hundreds of millions in fees, and left it buried under $25 billion in debt.
What Happened
- Apollo and TPG acquired Harrah's Entertainment in 2008 for $30.7 billion — one of the largest debt-fueled buyouts in history — and renamed it Caesars Entertainment
- Loaded the company with $25 billion in debt to fund the deal; annual interest payments exceeded $2 billion, more than double the company's operating income
- Apollo and TPG collected over $250 million in management and advisory fees while the company spiraled toward bankruptcy
- The operating unit filed for bankruptcy in 2015 while the parent holding company — structured to shield the PE firms — stayed out of proceedings
The Damage Done
- Hotel room quality and maintenance declined as renovation budgets were slashed to service $2 billion in annual interest payments
- Total Rewards loyalty program was repeatedly devalued — customers needed more points for the same comps, rooms, and perks they'd earned for years
- Multiple restaurants and buffets closed across Caesars properties as cost-cutting hit food and beverage — the famous Rio buffet among the casualties
- Over 10,000 employees laid off across the casino portfolio as the company cut costs to keep up with debt payments