Potential bidders for CEOC, a casino-operating unit of Caesars Entertainment would be wading into the middle of a costly and complicated bankruptcy, and they note that Caesars has left key assets — including a crucial piece of its big-data customer loyalty program — out of the package, according to a Reuters commentary yesterday. Analysts and some junior creditors have suggested that Caesars isn't serious about selling its CEOC operating unit and expressed doubt that the offering will attract any bidders. In court documents, the operating unit itself noted that the bidding process "may not result in any offers" and that if there is a successful bid "there is no guarantee that the transaction will close." One major factor behind buyers' skepticism about Caesars' proposed sale, designed to test CEOC's value under a plan to emerge from its $18 billion bankruptcy, is that the operating unit lacks clear control of its Total Rewards loyalty program, analysts and industry players said. The program manages sought-after information on its 45 million members' spending habits, and it instantly adds value to any casino brought into the program. Under a complex operating structure, CEOC owns Total Rewards. But a separate, non-bankrupt unit called Caesars Enterprise Services controls the licensing agreement that channels business between casinos putting that piece of the program out of reach of bidders for the casino operating unit. Read more.
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