Ameristar Casinos cancels sales plans

14 December 2010

LAS VEGAS, Nevada -- Ameristar Casinos canceled plans to consider a sale of the Las Vegas-based regional casino operator this morning, saying in a brief statement "a sale is not in the best interests of the Company and its stockholders at this time."

The company hired an investment bank and legal adviser in August to consider sales opportunities for the company or some of its regional casinos.

Speculation has surrounded the future of the casino operator since late 2006, following the death of company founder Craig Neilsen.

Ameristar said the Transaction Committee of its Board of Directors is no longer considering a possible sale of the company.

In the statement, the company didn't shut the door on a potential sale.

"The transaction committee will continue to explore other avenues to enhance stockholder value," the company said.

JP Morgan gaming analyst Joe Greff told investors there are few buyers in the market for a casino company.

"We interpret this to mean that there was little interest from third parties in buying the entire company by either casino operators or private equity at prices much higher than the $18 (more or less) share price range," Greff said in a research note.

Ameristar operates eight casinos in seven regional markets, including two small casinos in Northern Nevada.

Wells Fargo Securities gaming analyst Carlo Santarelli said the news should not impact the company's stock price.

"We do not believe, nor do we believe investors, will find this announcement surprising," Santarelli said.

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