Peter Park Discloses 5.2% Ownership Stake In Casino Entertainment Company Eldorado Resorts Inc. (ERI)

On July 7, Eldorado Resorts announced the acquisition of MGM Resorts International (NYSE:MGM)’s 50% interest in the Silver Legacy Resort Casino Reno, along with all the assets of Circus Circus Reno for $72.5 million. In addition to that, Eldorado expects to repay amounts outstanding under the Silver Legacy credit facility, with $60 million outstanding as of March 31, 2015. The CEO of the company, Gary Carano, claimed that this acquisition is expected to add value to the company’s operating results and strengthen its position in the increasingly attractive Reno gaming market. Just recently, Eldorado Resorts priced an offering of $375 million in aggregate principal amount of senior notes due 2023 at an interest rate of 7% per annum and announced its plans of selling shares of common stock to raise approximately $60 million in net proceeds, which will allow the company to pay the aforementioned purchase from MGM Resorts International, as well as refinance some of its debt. It is worth pointing out that Eldorado Resorts has been actively attempting to expand its operations and strengthen its financial position. The company’s debt refinancing activities will definitely free up money to fund further expansion and acquisitions, while the freshly-completed acquisition will boost the company’s revenues.

Now that we know what Eldorado Resorts’ moves have been so far, let’s take a look at the primary financial figures in the company’s financial report for the first quarter of 2015. The company reported total net revenue of $167.45 million in the first quarter of 2015, compared to a figure of $171.86 million reported in the same quarter a year ago. At the same time, the total adjusted EBITDA for the quarter amounted to $27.72 million, lower by 2.5% year-over-year. Moreover, the company reported a diluted loss per share of $0.13 for the first quarter of the current year, compared to a diluted loss per share of $0.10 reported a year ago. Despite the seemingly unsatisfactory results, the management of Eldorado has claimed that the company made good progress in the first quarter of 2015 with its property enhancement strategy, which is expected to deliver quite attractive returns in the upcoming quarters. Paul Reeder and Edward Shapiro’s PAR Capital Management is the largest investor in Eldorado Resorts Inc. (NASDAQ:ERI), with 3.80 million shares.

Disclosure: None