Caesars Entertainment Corporation, the owner of the World Series of Poker brand, announced on Tuesday that it will be spinning off its online gaming business and other assets into a completely new company. The creation of the new entity, Caesars Growth Partners, will be made possible in part by an investment by two private equity firms, Apollo Management and TPG Capital.

Apollo and TPG will each invest $250 million in the new business, which will take control of Caesars Interactive Entertainment (CIE), the arm of Caesars that is preparing an offering for the Nevada intrastate online poker market. Additionally, Growth Partners will purchase the Planet Hollywood Resort and Casino in Las Vegas and the still-under-development Horseshoe Baltimore from Caesars. The $500 million combined from the two investment partners could grow to as much as $1.2 billion.

Caesars is expected to own anywhere from 57% to 77% of Growth Partners, depending on the sale of shares. Caesars will also receive a call option that will allow it to repurchase all assets of the company in the future.

“The transaction is an important step in our ongoing efforts to improve the company’s balance sheet and position ourselves to make strategic investments,” said Caesars Entertainment Chairman, President, and CEO Gary Loveman in a press release. “Caesars Growth Partners and its simple and flexible capital structure provide us with a vehicle to pursue growth opportunities while retaining a significant portion of the financial upside associated with these assets and projects.”

“The transaction enables us to raise equity capital at attractive valuations without diluting stockholders of Caesars and provides Caesars additional cash liquidity without incurring new debt,” he added.

A second new company, Caesars Acquisition Company (CAC), has been created to facilitate the purchase. The investments from Apollo and TPG, as well as any investments by stockholders, will go into CAC and be used in the purchase of the aforementioned Caesars assets. Mitch Garber (pictured), CEO of CIE, will head up CAC and remain at his post at CIE.

The financial markets responded positively to the news, sending Caesars Entertainment (CZR) shares soaring to $17.07 in intraday trading on Tuesday, a 36.7% rise from the previous day’s close. The share price eventually settled back down to $15.90, still a 27.3% increase. On Thursday afternoon ET, shares were back up around $17.

The spinoff is intended to allow Caesars Entertainment to shed some of its $20 billion of debt. As the company said in its press release, “The transaction is intended to provide capital to allow Caesars to continue to fund growth opportunities in a less levered and more flexible vehicle than its existing operating subsidiaries.”

While Caesars stock jumped, not everyone was impressed. Travis Hoium of Motley Fool wrote, “It doesn’t fundamentally change the challenges for Caesars, particularly in regional gaming, and will dilute shareholders who don’t participate in the offering for Caesars Growth Partners. I don’t see how this makes the company significantly more valuable than it was yesterday and don’t think this is a buy sign for investors. If you’re interested in Caesars’ growth properties, it would be more beneficial to wait and buy the new company rather than buying the ‘growth’ and ‘non-growth’ assets today.”

Other analysts also don’t buy the debt relief angle. According to TheStreet, analysts say the goal of the move “is to raise money for operations and expansion rather than to get out from under its $20 billion debt burden.”

“This is not meant to de-lever Caesars,” Roth Capital Partners LLC Managing Director Eric Rindahl told TheStreet. “This allows the owners of Caesars to use capital to make new investments without paying down debt. Caesars has to invest to survive.”

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