History
In 1989 Ramada Inns, Inc. split its businesses, selling the hotel/restaurants to Hong Kong based New World Development for $540 million. The casinos including the Tropicana Atlantic City and the Tropicana Las Vegas were spun off into a new publicly traded company called Aztar Corporation.
In 1995 the new Aztar Corporation expanded its operations to include riverboat casinos in Caruthersville, Missouri and Evansville, Indiana. On March 5, 2002 Aztar acquired full ownership of the 34-acre (140,000 m2) Tropicana location in Las Vegas by purchasing the 50% share held by Chicago's Jaffe family. During 2005, the company acquired a site in Allentown, Pennsylvania with the intention of securing a gaming license and then developing a casino.
On March 13, 2006, Aztar announced plans to be acquired by Pinnacle Entertainment for $2.1 billion. Subsequent bids were made by Colony Capital, LLC, Columbia Sussex and Ameristar Casinos. As of April 26, 2006, all four companies were engaged in bidding over Aztar, with Pinnacle increased its bid to $45 per share, matching Ameristar's bid; Columbia Sussex had previously bid $47 per share. Later, Columbia Sussex increased its bid to $50 a share, all in cash. Aztar management determined on May 1 that the latest bid was preferred over Pinnacle's late increase to $48 a share, in cash and stock.
On May 4, 2006, Ameristar announced that it was pulling out of the bidding for Aztar. Additionally, Colony has apparently lost interest, having failed to increase its bid beyond $41 a share and making no public comment for several weeks. Since Columbia Sussex eventually outbid Pinnacle, the latter company was paid a $50 million termination fee plus expenses, which may total $16 million.
Bidding ended on May 19, 2006 with the acceptance of a $2.75 billion bid from Columbia Sussex. Columbia Sussex paid a $313 million breakup fee in advance, in case the deal fell through with $78 million of that used to pay the breakup fee to Pinnacle Entertainment. The sale closed in January 2007.
The New Jersey Casino Control Commission ultimately rejected Columbia Sussex's application for a gaming license for the Tropicana Atlantic City, sending the company's gaming businesses into bankruptcy. Most of the Aztar properties became part of the reorganized Tropicana Entertainment Inc. in March 2010.
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