Pinnacle says it will buy bankrupt President Casino
Sunday, February 26, 2006
The Associated Press
ST. LOUIS -- A Las Vegas company announced late Friday that it had reached a deal to buy the bankrupt President Casino on the Admiral for $31.5 million.
Pinnacle Entertainment Inc. announced the deal but did not detail its plans for the downtown casino. One option is to close the President and move its work force to a rival $400 million casino complex that Pinnacle is building nearby.
A May auction was also set as part of the deal. During the auction other companies can try to outbid Pinnacle. Penn National Gaming Inc., of Wyomissing, Pa., also has been in talks to buy the President and is a candidate to bid in the auction.
"There's any number of suitors that could emerge in the auction," said Jon Sloane, a spokesman for the President.
President Casinos Inc., the parent company, has been under bankruptcy protection since 2002, so the winning auction bid for the casino will need bankruptcy court approval. Then, the buyer faces securing a license from the Missouri Gaming Commission.
Penn National signed a deal in 2004 to buy the President out of bankruptcy court for $28 million. That offer served as a base price later that year for an auction in which Kentucky-based Columbia Sussex Corp. bid $57 million for the President, topping Penn and Pinnacle.
Late last year, Columbia Sussex backed away from the deal when it appeared the Gaming Commission would deny its application for a license.
The President has been surrounded by recent litigation. One case questioned if St. Louis can condemn a parking lot used by the President for a redevelopment plan that includes Pinnacle's $400 million casino complex, now under construction.
Also, the President has sued Columbia Sussex for breach of contract for walking from the previous deal.