Ah, the smell of
a bidding war!

Apr 4, 2006 4:01 AM

It’s easy to imagine Aztar CEO Bob Haddock doing one of those fist pumps as he pops the cork on a bottle of something expensive at his Arizona headquarters.

He’s finally got the fuse lit on something big. Yes, there’s nothing like a nice bidding war to get the shareholders’ blood flowing.

Pinnacle Entertainment offered $38 a share for Aztar a couple weeks ago.

Late last week, Colony Capital was knocking on the door looking to up the offer to somewhere north of $40 a share.

And on Monday, Ameristar Casinos reportedly offered $42 a share in an all-cash deal.

There will probably be other interested bidders before the action subsides ”¦ small companies probably, companies looking to grow in a hurry, thanks to Aztar’s prime locations in gaming’s two hottest markets — Atlantic City and Las Vegas.

Never mind that Colony does not yet have a lot of respect as a developer and operator of classy resorts. Pinnacle’s Dan Lee seems to get more respect, probably because of his good record during years spent with Steve Wynn.

But what Colony appears to have is lots of investment capital to sink into the stock of companies in which it takes an interest. And Colony has been doing a lot of shopping lately. It’s also recently made an offer for the Hard Rock Hotel and Casino in Las Vegas.

But that’s another story.

The U.S. casino industry hasn’t seen anything like the bidding war shaping up around Aztar since the late Arthur Goldberg was stepping in at the last minute to take Caesars Palace away from Steve Wynn, or since Hilton and Starwood years ago were trying to outbid each for control of ITT and its Sheraton properties.

Yes, deals like these are not over ”˜til they’re over.

And it’s a good time to be a shareholder in Aztar, whose stock was trading in the $44 range on Monday. Never mind that Aztar has been performing short of expectations during recent years. It’s got some nice locations — no, make that great locations — at a time when the U.S. casino industry shows few good prospects for future growth.

Can’t you imagine Haddock straining to see if there is anyone else coming down the hall behind the latest bidders?

Maybe he’s thinking that it just might be possible to get the $50 a share that Aztar executives were once hoping to see.

Timing is everything.

A year or two ago, Aztar was being "shopped aggressively" to qualified buyers who frowned and hemmed and hawed and declined to show the kind of interest Aztar bosses were hoping to get.

But perceptions have shifted as the opportunities for domestic expansion have slowed in stable growing markets such as Las Vegas and Atlantic City.

Pinnacle, for instance, would like to create some geographic diversity before company officials have to worry about its principal earners being clobbered by another hurricane or two in the south.

Some industry watchers, however, were surprised at the level of Colony’s interest.

"I don’t know how they can do that, they’re having trouble making some of their bond payments in Atlantic City," said one observer.

This was from a source affiliated with a group interested in one of Colony’s AC properties.

But none of this matters much to Haddock, who knows he’s in the right place at the right time with something to sell.

Nothing could feel much better than that.

CBS dips toe into poker waters

CBS Television has jumped into big-time poker with a decision to devote about eight hours to the Intercontinental Poker Championship that is to be filmed at the Palms this month.

The event will feature invited players representing about 21 different countries.

Hurricanes muddy Louisiana’s waters

Louisiana’s shifting demographics may change the face of gaming in that part of the country.

Pre-Katrina, who would have imagined Baton Rouge getting a lot of attention from the industry’s big thinkers?

But the sharply-increased numbers generated during recent months by casinos there have been holding up very nicely.

Poker continues meteoric rise

Internet poker continues its startling growth as illustrated by PokerStars.com doubling its roster of registered players to more than five million in less than a year.

This level of activity says a lot about the reason so many resorts from Las Vegas to Atlantic City have added or expanded card rooms during the last year or so.

The Venetian just opened a room of some 40 tables, putting a veteran poker executive from the giant Foxwoods in charge.

Sweet smell of rhetoric

Don’t you love the boastful rhetoric?

A Harrah’s insider found himself frowning at Steve Wynn’s recent claim that Wynn Las Vegas slots have the highest win per machine in the state.

My insider friend frowned again, "I don’t know how he can make a statement like that. I can’t imagine anyone doing any better than us.

So give me a number, I said. How much does Harrah’s generate at either of its Las Vegas properties?

Neither Wynn nor Harrah’s have offered a number, but that’s the way business is conducted these days in a climate where impressing the Wall Street number crunchers has never been more important.