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Landry's directors accept Tilman Fertitta's offer

Jun 17, 2008 7:03 PM

by Ray Poirier |Last January, Tilman Fertitta offered to buy the 61% of the outstanding shares in Landry’s Restaurant Inc. (LNY) that he didn’t already own for $23.50 per share.

Three months later, when there was no response to his offer and with the financial markets tightening up, Fertitta renewed his offer but at $21 per share.

Finally, the company’s directors responded by appointing Cowen and Company as its financial advisor.

On Monday, the directors agreed to the buyout but added a condition. Apparently after six months with no outside responses, the directors still feel that there might be other bidders out there so they provided that for 45 days following the signing of the merger agreement, they will actively solicit superior acquisition proposals from third parties.

Paying $21 per share and assuming the company’s $885 million of debt, the Fertitta offer totals $1.3 billion.

In announcing his April offer, Fertitta indicated that he had received debt financing commitments from Jefferies & Company Inc. and from Wells Fargo Foothill LLC.

Involved in the takeover are the company’s 179 restaurants and two casinos, the Golden Nugget properties in both Las Vegas and Laughlin. The company employs more than 24,000 people.

The sale, which is subject to shareholders as well as gaming regulators, is expected to close in four months.

Since the April offer the company’s shares have been trading around $16 each but on Monday, following the announcement, they jumped to almost $20.