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The operations of Caesars’ online casino products like Caesars Palace and Horseshoe online casinos might soon be separated from Caesars Entertainment’s other business interests. Caesars Entertainment CEO Tom Reeg discussed the possibility of creating a separate publicly traded company for Caesars’ online gaming division during the company’s investor presentation covering the company’s performance for the fourth quarter of 2024 and the full year.
That discussion follows significant gains in revenue for legal online casinos in the United States, including Caesars’ platforms. The potential IPO could bring an infusion of capital to continue that momentum.
Reeg introduces public listing possibility
On Feb. 25, Reeg responded to a question about maximizing value from the company’s digital division, explaining that all options are on the table.
If the market dynamics remain the same, and the business continues to grow as it has, you should expect that we would look at any and all avenues in of how we can drive the most value.
The dynamics Reeg referred to include record highs for revenue from online casino play in the US. 2023.
Caesars experienced its share of that growth. Combined with revenue from its online horse race wagering and sports betting products, the digital division produced almost $1.2 billion in revenue for the company, an increase of over 16.4% compared to 2023.
Continuing that growth trajectory could require substantial capital. That’s where a new IPO for Caesars Digital would come in.
Public listing could aid in improving, promoting Caesars online casino platforms
While spinning off Caesars Digital into its own company would represent significant upfront costs for Caesars, the time could be ideal for that move. Not only is the division more valuable than ever but gaming stocks are currently at high valuations in the US.
As Reeg alluded to, continuance of those circumstances could bring in a massive infusion of cash for the new company to use to proliferate its footprint and market share. Caesars offers iGaming products in four US states but none of those brands are among the top three contenders for the market share by revenue lead in any of those states.
Investments into product improvement and marketing could help shore up that standing. If the money for those investments comes from the public via an IPO, those costs wouldn’t hamper Caesars’ ability to invest in its other operations.
There is no timeline for when Caesars might announce a public offering as Reeg only stated that the company is considering the digital spin-off. The conditions for that action might currently be as ideal as they will ever be.
