Friday, December 22, 2006

Harrah's Sold, WSOP Included in Deal

News popped earlier this week that Harrah's Entertainment, Inc. had accepted a buyout offer, one of several that it was reviewing, and will be selling Harrah's and all brands and property that it owns to affiliates of Texas Pacific Group and Apollo Mgmt L.P., in a transaction that will take the giant entertainment off the market and back into private ownership.

Trading in Harrah's stock was suspended on December 19th in anticipation of the announcement, with the total value of the deal estimated at $27.8 billion, or about $90 per oustanding share.

The World Series of Poker, of course, is among the brand names included in the sale, and this now has some people wondering about changes to the WSOP. In the short term, poker players will see no effect whatsoever, as the transaction will take twelve to eighteen months to be finalized and receive regulatory approval, meaning that the '07 WSOP is likely to go on exactly as it has in recent years, in the Amazon Room at the Rio in Las Vegas.

However, speculation on the ultimate fate of the Rio itself suggests that its marriage to the WSOP isn't exactly set in stone. There's no reason that the Rio has to be the hosting site for the WSOP, and the Rio, in its west-of-Strip location, might not be the site that its new owners choose for the event. That said, the WSOP is one of the most valuable brand names under the Harrah's Entertainment umbrella --- it's now rumored to be in Harrah's top five in actuarial worth --- and it well have a home somewhere in 2008 and behind, possibly but not necessarily at the Rio.

True, the Rio itself was strained for room, but the passage of the UIGEA meant that this was likely not a concern for, at the minimum, the 2007 version of the event. So make those plans for Vegas in June and July, solid in the knowledge that for this year, the show at the Rio will go on.

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