Harrah’s Registers up to $710 Million in Common Stock

Harrah’s announced late last week that it had filed to register up to $710 million in common stock, with the plan that the company would be on a major national securities exchange with a yet-to-be-determined trading symbol.

The $710 million marks just a small part of Harrah’s net worth, and the selling of the shares is not expected to benefit the company directly.

“Was this the long-awaited IPO (initial public offering)? No, it was a registration statement for Paulson & Company who acquired shares in an exchange for bonds previously purchased,” Barbara Cappaert of KDP Advisor told investors, according to MarketWatch. “It certainly tests the market as to what Harrah’s is worth, but it is curious that the company does not think an-all out IPO for company raised shares can be done.”

Paulson & Company is a hedge fund firm that holds a 4.9 percent equity stake in Harrah’s, and could potentially hold a 9.9 percent stake if gaming regulators allow the firm to exchange further dept, according to the New York Times.

Harrah’s announced in June that it would be giving new equity to investors because of the amount of debt they held. In the casino operator’s most recent filing, it reported $20 billion worth of debt.

Harrah’s was acquired by Apollo Global Management and TPG Capital in 2008 in a $27.8 billion deal.

Although Harrah’s reported a $274 million loss in its second quarter, CEO Gary Loveman expressed optimism: “During the past two years, we’ve reduced expenses and debt substantially, increased our liquidity to about $3 billion, and acquired the Planet Hollywood Resort and Casino in Las Vegas and Thistletown racetrack in Cleveland. I believe we’re well-positioned for an eventual legalization of online gaming in the United States, and more capable of capitalizing on additional growth opportunities than at any time in the past two years.”

Harrah’s owns and operates the World Series of Poker out of its Rio casino just off the Las Vegas Strip. The company recently launched a free-play site for Americans to accompany its real money site in the UK.

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