Icahn increases Caesars stake to 15.53%

8 March 2019

Billionaire investor Carl Icahn has increased his stake in Caesars Entertainment Corporation to 15.53% as he pushes for the business to pursue a sale or merger.

A filing to the Securities and Exchange Commission (SEC) revealed that Icahn now holds 104,975,363 shares in the business, amounting to 15.53% of the operator’s total share capital. Last week the activist investor disclosed a 9.78% stake in the operator.

Icahn has argued that a merger or sale would be beneficial for Caesars shareholders, arguing that its stock has underperformed compared to its rivals in the industry. Shares in Caesars Entertainment were trading down 1.27% at $8.58 per share in New York on Friday (March 8), having seen their value decline 31.36% over the past year.

He is also looking to be involved in the company’s succession planning, with chief executive Mark Frissora set to step down from his role in April.

Frissora, who has served as Caesars CEO since 2015, leading the business through a post-bankruptcy restructuring, was due to leave his role in February 2019, only for the departure date to be pushed back as the company hunts for his replacement. Icahn has been widely reported as promoting former Tropicana Entertainment and current Affinity Gaming CEO as the ideal candidate for the job.

Last week Icahn also reached an agreement with the Caesars board to vote in favour of all proposed board nominations at the operator’s 2019 Annual General Meeting. A date for the AGM is yet to be set.

In return, a trio of executives working for Icahn were appointed to the Caesars board. Keith Cozza, chief executive of Icahn’s Icahn Enterprises conglomerate, Icahn Enterprises director James Nelson and Courtney Mather, portfolio manager for the investor’s Icahn Capital fund, all joined with immediate effect. This will result in three existing directors stepping down.

Should Caesars fail to select a new CEO within 45 days of the trio joining the board, Icahn will then have the right to appoint a fourth director.

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