Harrah's reportedly talking about buying rival Caesars

LAS VEGAS — Harrah's Entertainment Inc. is negotiating to buy gambling rival Caesars Entertainment Inc. and leapfrog ahead of the proposed merger of MGM Mirage and Mandalay Resort Group as the biggest gambling company in the world.

The two Las Vegas-based companies could announce an agreement this week, according to a source close to the talks, who spoke Wednesday on condition of anonymity.

The companies began negotiating after MGM Mirage cemented a deal last month to buy Mandalay Resort Group for $4.8 billion in cash, the source said. That deal must be approved by federal and state gambling regulators.

Terms of the possible Harrah's-Caesars deal were not available. Caesars market value stood at about $5 billion Wednesday. The company also has nearly that amount in debt.

Top executives at both companies did not take phone calls Wednesday and messages left with spokesmen were not immediately returned.

News of the possible buyout, reported Wednesday by The Wall Street Journal and Las Vegas Review-Journal, sent Caesars shares up nearly 15 percent, while Harrah's stock slipped.

Harrah's, which is heavily into riverboat casinos, has 26 casinos in 13 states under the Harrah's and Showboat names — and has 41,000 employees.

Caesars has 27 properties in five countries on four continents, including Caesars Palace and Bally's Las Vegas, and employs 54,000.