Isle of Capri agrees to buy Casino Aztar
Kansas City Star
St. Louis-based Isle of Capri Casinos Inc. said Monday it had agreed to buy Casino Aztar in Caruthersville, Mo., for an estimated $45 million.
The seller is an affiliate of Kentucky-based Columbia Sussex Corp.
The sale is subject to approval by the Missouri Gaming Commission, which seized management control of the gambling boat Jan. 3 and will continue to operate it until new owners are licensed.
Ownership issues arose last year when Phoenix-based Aztar Corp. agreed to be acquired by privately held Columbia Sussex in a $2 billion deal. When the merger stumbled over Columbia Sussex's apparent inability to be licensed by Missouri, Aztar officials threatened to close the casino to preserve the deal.
The Gaming Commission took over within hours of the merger closing.
The merger was approved by other gambling jurisdictions, including Nevada, New Jersey and Indiana. Missouri Gaming Commission officials have declined to discuss Columbia Sussex's licensing issues.
The commission in October also balked at licensing Illinois-based startup Fortunes Entertainment LLC as Aztar owner, also for undisclosed reasons.
Privately held Columbia Sussex, which is owned by William J. Yung and family members, folded Aztar's five casinos into its holdings, enlarging the group to 13 casinos, including Aztar's Tropicana-branded properties in Atlantic City, N.J., and Las Vegas, and 75 hotels around the world.
It's not clear how Aztar's modest Missouri casino might have fared under Columbia Sussex ownership.
Since the takeover, Columbia Sussex chief financial officer Rich Fitzpatrick has confirmed that the company has cut the work force at the Las Vegas Tropicana but would not disclose numbers.
'We're 'rightsizing' the organization and eliminating underperforming assets,' Fitzpatrick told the Las Vegas Review-Journal last month.
The casino's future also is unclear under Isle management.
'At this time we do not anticipate staffing changes,' Isle spokeswoman Jill Haynes said Monday.
Isle also hasn't decided on a name for the casino. The company operates four distinct brands, including Isle of Capri, Rhythm City, Colorado Central Station and The Isle, a new theme soon to make its debut at its Pompano Park racetrack casino in Pompano Beach, Fla.
Market analysts Monday were lukewarm to the Isle acquisition. Morgan Joseph's Adam Steinberg estimated the rural casino might add up to 2 cents per share to company earnings.
'In our opinion, we believe the company could get better returns by investing that money in upgrades to some of its existing properties,' he concluded in a note to investors.
Licensing of Isle, which currently operates riverboat casinos in Kansas City and Boonville, Mo., is expected to proceed quickly. The company is one of the nation's 10 largest publicly held gaming companies with 13 casinos and a racetrack in six states and overseas locations.
'We think this will be finalized by summertime ... early summer,' commission director Gene McNary said Monday.
If approved, Isle would become the first casino company with three Missouri properties.
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