Reverse Termination Fee

In gambling M&A the reverse termination fee is usually the single most negotiated number in the agreement, because it is where regulatory risk is priced. A target agreeing to be acquired takes its business off the market, tells its staff and its regulators, and absorbs months of disruption. If the buyer then cannot get licensed, or cannot raise the debt, the target is left with the damage and no transaction. The reverse fee is what it collects instead.

Size signals conviction. Caesars Entertainment’s 2026 agreement carries a $450 million reverse fee against a $200 million fee payable by the company, and that asymmetry is deliberate: the buyer is the party carrying the licensing and financing risk, so the buyer posts the larger stake. The fee also interacts with the covenant standard. A buyer that has accepted a hell-or-high-water obligation on regulatory approvals has agreed to do almost anything to get cleared, and a large reverse fee is what makes that promise credible. Where the covenant is softer, a reasonable best efforts standard, the reverse fee is often the only real protection the seller has. Readers assessing whether an announced gambling deal will actually complete should look at this number before they look at the price.