Bally Entertainment was purchased in 1995 by Hilton Hotels Corporation.
The company completed a $3 billion acquisition of Bally Entertainment in December, which made it a major player in casinos.
Bally Entertainment, with five casinos, including two in Atlantic City, was a natural target.
Bally Entertainment has been working on the spinoff for more than a year.
Cloverleaf accepted a $10.6 million loan from Bally Entertainment in hopes to allow a casino at Rosecroft.
Bally Entertainment said it expected to open its new $100 million Western casino, entertainment complex and shopping area by the summer of 1997.
The Hilton Hotels Corporation eventually agreed to buy Bally Entertainment for $3 billion.
He is now in partnership with Bally Entertainment.
Hilton said last week that it planned to buy Bally Entertainment for about $3 billion in stock and assumed debt.
Bally Entertainment is the force behind Florida Locally Approved Gaming.