Penn Nat’l Buyout Gets Illinois OK

NEW YORK (Reuters) – Penn National Gaming Inc (PENN.O: Quote, Profile, Research, Stock Buzz) on Thursday said the Illinois Gaming Board has approved its pending acquisition by a group led by Fortress Investment, leading it one step closer to getting all the needed approvals for the $6.1 billion deal.

Fortress and Centerbridge Partners agreed to buy the casino and racetrack operator in June last year for $67 a share. In March this year, the company said the per-share amount would rise by $0.0149 per day if the buyout were not completed by June 15.

Earlier this month, Penn extended the deadline to Oct. 13 from June 15, saying that all regulatory approvals would not be obtained before the original deadline.

It is one of the last remaining leveraged buyouts still to close, along with the $34.1 billion takeover of Canadian telecommunications company BCE Inc (BCE.TO: Quote, Profile, Research, Stock Buzz)(BCE.N: Quote, Profile, Research, Stock Buzz). A number of leveraged buyout deals have collapsed in the wake of the credit crunch last summer which made financing large buyouts impossible.

Traders are still concerned about the Penn National deal closing, even if it gets all required gaming approvals. The company's shares were down 71 cents at $33.43 on Thursday, far below the takeover price.

The Gambling and racing activities are individually controlled by states, so the company needs approval from each state in which it operates.

Penn is still awaiting approval from gaming authorities in Missouri, Indiana and Louisiana and the Maine Harness Racing Commission.