Columbia Sussex Wins Aztar Bidding War

Tropicana casino operator Aztar Corp. said Friday that it had agreed to be acquired by hotel and casino owner Columbia Sussex Corp. for $54 a share in cash, or about $1.9 billion.

The deal signals an end to a two-month bidding war for Phoenix-based Aztar, which owns 34 acres of prime Las Vegas Strip real estate.

Aztar had previously agreed to an offer of $51 a share in cash and stock from Pinnacle Entertainment Inc., which said Friday that it would not raise its bid.

Pinnacle made a “good disciplined decision,” Deutsche Bank analyst Mark Falcone said in a report, considering that a $54-a-share price values Aztar’s Las Vegas property at more than $30 million an acre.

Pinnacle offered $38 a share for Aztar in March, but the takeover deal was soon challenged by rival bids from Columbia Sussex, real estate investment firm Colony Capital and Ameristar Casinos Inc.

Columbia Sussex said it would also pay holders of Aztar’s series B preferred stock $571.13 a share in cash and assume about $676 million in debt.

Aztar said it paid Pinnacle $78 million in termination fees and expenses.

Trading of Aztar’s shares, which fell 48 cents to $51.57, was halted after hours. Shares of Pinnacle rose $2.13 to $30.75.