LAS VEGAS, April 17 /PRNewswire-FirstCall/ -- Pinnacle Entertainment, Inc. today announced it has signed a letter of intent under which it will acquire certain Lake Charles, Louisiana gaming assets of Harrah's Entertainment, Inc. . Additionally, the letter calls for the sale of certain of Pinnacle's Casino Magic Biloxi assets to a subsidiary of Harrah's Entertainment.
Under the agreement, Pinnacle will acquire Harrah's Lake Charles, which includes two casino boats and a 263-room hotel. Harrah's Lake Charles was severely damaged by Hurricane Rita in September 2005, and the casino remains closed although the hotel reopened in February 2006. Harrah's will acquire Pinnacle's Casino Magic Biloxi site and certain related assets. Casino Magic Biloxi has been closed since being struck by Hurricane Katrina on Aug. 29, 2005, which destroyed the gaming barge and extensively damaged the hotel complex. Each company will retain their insurance claims.
"Our L'Auberge du Lac facility in Lake Charles is close to the maximum gaming capacity permitted by the Louisiana gaming laws," said Daniel R. Lee, Pinnacle's Chairman and Chief Executive Officer. "The purchase of Harrah's Lake Charles allows us to build on our success in that market and enhance our Louisiana operations. As for Mississippi, we enjoyed being a part of the Biloxi community for many years and hope to return in the future. For the moment, however, we have decided to exit that market due to our relatively small site, the evolving competitive environment, and the demands elsewhere on our resources."
The letter of intent is non-binding and is subject to the signing of a definitive agreement, as well as the receipt of all required regulatory approvals.
About Pinnacle Entertainment
Pinnacle Entertainment owns and operates casinos in Nevada, Louisiana, Indiana and Argentina, owns a hotel in Missouri, receives lease income from two card club casinos in the Los Angeles metropolitan area, has been licensed to operate a small casino in the Bahamas, and owns a casino site and has significant insurance claims related to a hurricane-damaged casino previously operated in Biloxi, Mississippi. Pinnacle also has two casino development projects in the St. Louis, Missouri area, which are dependent upon final approval by the Missouri Gaming Commission.
All statements included in this press release, other than historical information or statements of historical fact, are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including statements regarding the proposed transactions with Harrah's Entertainment, Inc., are based on Pinnacle management's current expectations and are subject to risks, uncertainties and changes in circumstances that could significantly affect future results. Accordingly, Pinnacle cautions that the forward-looking statements contained herein are qualified by important factors that could cause actual results to differ materially from those reflected by such statements. Such factors include, but are not limited to: (a) the risk that the proposed transactions with Harrah's are not consummated; (b) the risk that new projects and expansions could strain Pinnacle's financial resources and might not provide for a sufficient return, if any; (c) many construction-related factors could prevent Pinnacle from completing its construction and development projects within budget and on time; and (d) other risks, including those as may be detailed from time to time in Pinnacle's filings with the Securities and Exchange Commission ("SEC"). For more information on the potential factors that could affect Pinnacle's financial results and business, review Pinnacle's filings with the SEC, including its Annual Report on Form 10-K, its Quarterly Reports on Form 10-Q and its Current Reports on Form 8-K.
For further information
At the Company - (702) 784-7777:
Dan Lee, Chairman & CEO
Wade Hundley, President
Steve Capp, CFO
Chris Plant or Lewis Fanger, Investor Relations
