Aztar

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Aztar Corporation (NYSE: AZR) is a hospitality company that is focused on resort hotels and casinos. It is currently the subject of a bidding war for ownership of the company.

The Tropicana Resort & Casino and the Tropicana Casino Resort Atlantic City contribute 70% of Aztar revenues.

[edit] History

In 1989 Ramada Inns, Inc. split its businesses, selling the hotel/restaurants to Hong Kong based New World Development Company for $540 million. The casinos including the Tropicana Atlantic City and the Tropicana Las Vegas were spun off into a new publicly traded company called Aztar Corporation.

On March 5, 2002 Aztar acquired full ownership of the 34 acre Tropicana location in Las Vegas by purchasing the 50% share held by Chicago's Jaffe family.

During 2005, the company acquired a site in Allentown, Pennsylvania with the intention of securing a gaming license and then developing a casino at this location.

On March 13, 2006, Aztar announced plans to be acquired by Pinnacle Entertainment for $2.1 billion. Subsequent bids were made by Colony Capital, LLC, Columbia Sussex and Ameristar Casinos. As of April 26, 2006, all four companies were engaged in bidding over Aztar, with Pinnacle increased its bid to $45 per share, matching Ameristar's bid; Columbia Sussex had previously bid $47 per share.[1] Later, Columbia Sussex increased its bid to $50 a share, all in cash. Aztar management determined on May 1 that the latest bid was preferred over Pinnacle's late increase to $48 a share, in cash and stock.

On May 4, Ameristar announced that it was pulling out of the bidding for Aztar. Additionally, Colony has apparently lost interest, having failed to increase its bid beyond $41 a share and making no public comment for several weeks. If Columbia Sussex eventually outbids Pinnacle, the latter company will be paid a $50 million termination fee plus expenses, which may total $16 million.[2] Bidding ended on May 19, 2006 with the acceptance of a $2.75 billion bid from Columbia Sussex. Columbia Sussex paid a $313 million breakup fee in advance in case the deal falls through with $78 million of that used to pay the breakup fee to Pinnacle Entertainment.

The sale was approved by the Nevada Gaming Commission on November 16, 2006.