Updated 

FTC signs off Pinnacle Entertainment's $2.8 billion purchase of Ameristar


The Federal Trade Commission formally approved plans by Pinnacle Entertainment to sell a St. Louis casino and Lake Charles, La., development project, allowing the Las Vegas-based regional gaming operator to move forward with its $2.8 billion acquisition of Ameristar Casinos.

Pinnacle hopes to close the purchase by the end of the month. With the FTC sign-off of the consent agreement package, the company has received all regulatory approvals needed to complete the transaction.

Nevada gaming regulators signed off on the deal in May.

A spokesman for Pinnacle declined comment Tuesday.

The FTC voted 4-0 to approve Pinnacle’s plan to avoid any antitrust violations in the company’s purchase of its regional gaming rival. Once the deal closes, Pinnacle will operate 16 casinos in nine states.

“The proposed order announced today is an example of the commission’s continuing efforts to preserve competition on behalf of consumers,” Deborah Feinstein, director of the FTC’s Bureau of Competition said in a statement. “This agreement will preserve competition in these areas, ensuring casino patrons benefit from competitive pricing and amenities.”

Pinnacle agreed last month to sell Ameristar’s $580 million development project in Lake Charles to Golden Nugget Casinos, a subsidiary of Landry’s Inc. That transaction requires approval of Louisiana gaming regulators.

Pinnacle will continue to operate the company’s L’Auberge Lake Charles, which is adjacent to the Ameristar development.

Under the terms of the order, Pinnacle has six months to sell its Lumiere Place Casino in downtown St. Louis to a buyer approved by the FTC. If a deal to sell Lumiere can’t be reached, Pinnacle will be required to sell Ameristar St. Charles. The hotel-casino is located in a community just outside of St. Louis.

Pinnacle also owns the River City Casino in suburban St. Louis.

The FTC said the consent agreement allows Pinnacle to “immediately” close the Ameristar transaction.

Brean Capital gaming analyst Justin Sebastiano said the FTC approval was the news investors had been waiting to hear.

“We believe that the pending Ameristar acquisition, Pinnacle’s development pipeline, and the company’s ability to market effectively position Pinnacle well for steady long-term growth,” Sebastiano said.

Shares of Pinnacle closed at $21.96 on the New York Stock Exchange, up 11 cents or 0.50 percent. Ameristar finished up 3 cents, or 0.11 percent, at $26.50 on the Nasdaq.

In December, Pinnacle agreed to buy Ameristar for $26.50 a share while assuming $1.9 billion of the company’s debt.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Follow @howardstutz on Twitter.

 

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