Columbia Sussex Buying Caesars Tahoe for $45M

LAKE TAHOE, NV-Columbia Sussex Corp. is picking up a second property from Caesars Entertainment Inc. In advance of its acquisition by Harrah’s Entertainment Inc., Las vegas-based Caesars has agreed to sell its Caesars Tahoe property to the Kentucky-based private hotel, resort and casino operator for $45 million. In October, Caesars agreed to sell its Bally’s Casino New Orleans riverboat to the company for about $24 million. Both sales are expected to close in the the second quarter of 2005. Columbia Sussex is one of the nation’s largest privately held hotel owners. It has been growing its casino properties over the past two years. If these new transactions close, the company would own two casinos in Lake Tahoe. Only Harrah’s owns more in the city, with three. Caesars also recently announced the sale of its Atlantic City Hilton and Bally’s Tunica properties to Colony Capital in a package deal with Harrah’s casinos in East Chicago, IN and Tunica, MS. In December 2003, Caesars announced the sale of its Las Vegas Hilton property to Colony Capital. In announcing the pending sale of Caesars Tahoe, Columbia Sussex president William Young says the property will be renamed as part of a rebranding designed to make the property appealing to a younger, hipper audience “and remain competitive in light of the proliferation of Indian Gaming in California.” Under the terms of the agreement, Columbia Sussex will purchase certain assets of Caesars Tahoe and will assume certain related current liabilities. The aggregate consideration may be adjusted for changes in net working capital. Libra Securities is the exclusive financial advisor to Columbia Sussex and Caesars Entertainment was represented by CB Richard Ellis on the transaction.