Gary Loveman, chief executive of U.S.-based casino operator Caesars Entertainment Corp, whose largest unit recently filed for Chapter 11 bankruptcy, plans to step down from the role, the parent company said on Wednesday.
Mr Loveman (pictured) will continue to serve as chairman of Caesars Entertainment and of Caesars Entertainment Operating Co Inc (CEOC), the firm’s operating unit now in bankruptcy, according to Wednesday’s statement.
“As chairman, Loveman will continue to oversee the restructuring of CEOC,” the company added.
Mark Frissora, a former CEO of rental car firm Hertz Global Holdings Inc, will succeed Mr Loveman as Caesars’ group CEO, Caesars Entertainment said. He will join as “CEO designee” until he formally becomes CEO on July 1.
Mr Frissora has no experience in casino operations, but Caesars Entertainment said he has “a track record of operating, growing and creating value at complex and highly leveraged companies.”
“During the transition period, he [Mr Frissora] will work with Loveman and the board to familiarise himself with Caesars’ operations and leadership team and go through the regulatory licensing process,” the company said.
Mr Loveman, who joined the group – formerly known as Harrah’s Entertainment Inc – in 1998, presided over the acquisitions of several brands and properties in the U.S. Currently, Caesars Entertainment and its subsidiaries operate about 50 casinos in 13 U.S. states and five countries.
The change comes less than a month after CEOC voluntarily filed for bankruptcy in Chicago, Illinois. It is part of a plan by Caesars Entertainment to cut group debt – amounting to about US$18.4 billion – by approximately US$10 billion.
In Wednesday’s statement, Mr Loveman said the time “is ripe for a transition”.
“My decision to begin to transition management now comes with the confidence that we have taken the steps necessary to ensure the company’s long-term success,” he said.
“I am confident that the efforts under way to address the capital structure of CEOC and the announced merger of Caesars Acquisition Corp and Caesars Entertainment will position Caesars for growth and prosperity for many years to come.”
The brand has long coveted casino operations in the high growth Asian region. Mr Loveman has admitted that not entering the Macau gaming market was the biggest mistake the company ever made.
The firm turned down a deal to acquire a Macau sub-concession in 2006 but a year later paid US$577 million for a golf course in the city in an unsuccessful attempt to parlay it into a casino project. The company sold the land last year to local investors for US$438 million, 24 percent below what it had paid seven years earlier.
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”We expect Goa to quickly become a US$1 billion market as it transitions to land-based casinos (from US$150 million today), which is still just a fraction of India’s total GGR potential of US$10 billion to US$17 billion”
Analyst at Union Gaming Securities Asia