Casino mergers and acquisitions activity is expected to increase in 2025, driven by declining interest rates and a more favorable regulatory environment. This forecast emerged from Truist Securities' recent Wicked Good 12th Annual GLLR Summit in Boston.

Key factors driving this trend include:

• Federal Reserve's recent interest rate cuts making financing more accessible
• Expected continuation of rate cuts under President-elect Trump
• Anticipated more favorable Federal Trade Commission (FTC) administration
• Improved velocity of M&A discussions since Fed rate cuts began

The regulatory landscape is shifting with Trump's nomination of Andrew Ferguson as FTC chair, potentially creating a more merger-friendly environment compared to the current administration under Lina Khan.

Notable industry developments to watch:

1. Potential Online Gaming Spinoffs:

• Caesars Entertainment considering separating its digital operations
• Penn Entertainment may explore similar moves with ESPN Bet
• Standalone iGaming opportunities gaining attention

2. Market Considerations:

• Valuation expectations and bid/ask spreads remain crucial factors
• Management teams express confidence in maintaining current tax structures
• Industry leaders see low probability of successful tax increase bills

While 2024 saw numerous merger rumors, particularly involving Boyd Gaming and Penn Entertainment, 2025 could bring more concrete deals to fruition, especially with improved financing conditions and regulatory support.

Interactive gaming remains a key focus, though state tax revisions pose potential risks. However, industry executives express optimism about maintaining favorable tax environments despite possible legislative challenges.

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