Station’s buyout ok to proceed

Nov 6, 2007 5:44 AM

Station Casinos has cleared its final hurdle to going private.

The Las Vegas-based company’s $5.4 billion buyout has won approval from the National Indian Gaming Commission (NIGC), according to regulatory filings submitted last week.

The Indian commission’s approval clears the way for the $90 per share buyout to close this week, possibly by Tuesday, the filing said.

Station Casinos owns and operates a dozen casinos serving the Las Vegas Valley, including the Red Rock Casino Resort & Spa. And, because it operates a tribal casino in California, the deal required the approval of the NIGC.

Station agreed in February to a buyout offer by an investor group that includes members of the company’s founding family. Shareholders representing 79 percent of the stock approved the offer by Fertitta Colony Partners LLC in August.

The going-private deal also includes the assumption of $2.3 billion in debt and the paying off of a $1.1 billion revolving line of credit.

Fertitta Colony Partners was formed by Chief Executive Frank J. Fertitta III, President Lorenzo J. Fertitta, and Colony Capital Acquisitions LLC, part of Colony Capital LLC, the Los Angeles-based real estate investment company run by billionaire Tom Barrack.

The Fertitta’s father started Station Casinos in 1976. It went public in 1993. When the privatization is completed, Colony Capital will own about 75 percent of Station Casinos while the Fertitta brothers, their sister, Delise Sartini and her husband, Blake Sartini, will own the remainder.

Under terms of the buyout, holders of Station common stock will receive $90 per share in cash for each outstanding share, and the company’s stock will be immediately de-listed from the New York Stock Exchange.

The Fertitta brothers will continue handling the day-to-day operation of the company. The strategy going forward is to continue expanding the number of Nevada casinos, as well as third-party management contracts with American Indian casinos.

Colony Capital is one of only a few private investment firms licensed in gaming. In addition to the Las Vegas Hilton, it owns Resorts International Atlantic City, Resorts East Chicago, Resorts Tunica, Atlantic City Hilton and Bally’s. Colony is also a partner in Accor Casinos in Europe.