Caesars Entertainment Corp. fell 11 percent, the most in almost a year, after the stock began trading without rights to participate in an IPO of the company’s online gambling unit.
Investors who bought the shares today didn’t get rights to a new unit that will own part of the online gaming division, Richard Hightower, an analyst at International Strategy & Investment Group LLC, said in an interview. Those who owned them yesterday will be able to buy Caesars Acquisition Co. stock.
“You can sell the stock today and settle and still keep” the subscription rights, John Kempf, an analyst at RBC Capital Markets in New York, said in an e-mail.
Caesars fell to $19.91 at the close in New York, the biggest drop since Nov. 14, 2012. The shares have almost tripled this year as the company set plans for the gambling unit and restructured some of its $23 billion in debt.
The Las Vegas-based company, owner of the Caesars Palace casino, along with Harrah’s and Bally’s on the Las Vegas Strip, set Oct. 17 as the record date for investors to participate in the offering of Caesars Acquisition, which includes the online gambling business. Caesars, the largest owner of U.S. casinos, has more debt than any other casino or hotel company. It is seeking to raise as much as $1.18 billion for the gambling unit.
Caesars Acquisition will own a piece of Caesars’ interactive gaming business as well as two casinos, Planet Hollywood in Las Vegas and a Horseshoe property under construction in Baltimore, the company said in an Oct. 3 release.