NEW YORK (AP) — Eldorado has agreed to pay more to acquire MTR Gaming Group.
MTR’s stock jumped to its highest point in more than a year in early trading on Tuesday following disclosure of the deal.
Eldorado HoldCo LLC, parent of Eldorado Resorts, said Tuesday that it amended its prior deal with MTR. The company will now pay $6.05 per share to MTR stockholders for each share they own, up from its previous offer of $5.15 per share.
Eldorado said there will also be an additional $5 million in cash available to MTR stockholders once the transaction closes. This puts the total cash amount payable to MTR stockholders at $35 million.
Eldorado Resorts LLC operates the Eldorado Reno in Reno, Nev. and Eldorado Shreveport in Louisiana. It also has a joint venture with MGM Resorts International in Reno called the Silver Legacy.
MTR runs Presque Isle Downs & Casino near Erie, Pa., Mountaineer Casino and Racetrack & Resort in Chester, W.Va., and Scioto Downs in Columbus, Ohio. The company said that under the amended agreement, it will increase the termination fee to $6 million from $5 million and raise the amount of expense reimbursement payable to Eldorado in certain circumstances to $1 million from $500,000.
MTR’s board has unanimously approved the amended deal.
In addition, Jacobs Entertainment Inc. —which made its own bid for MTR last month — agreed to vote in favor of the amended Eldorado and MTR deal. Jacobs, which is a minority shareholder of MTR, owns the Colonial Downs thoroughbred track and 10 off-track betting facilities in Virginia; The Lodge Casino at Black Hawk and the Gilpin Hotel Casino, both in Colorado; the Gold Dust West-Reno, the Gold Dust West-Carson City and the Gold Dust West-Elko in Nevada; and 23 video poker truck stops in Louisiana.
The combined company’s board will have seven members, with five expected to be independent directors.
The proposed deal still needs approval from MTR shareholders and the necessary government approvals.
Shares of MTR Gaming Group Inc. gained 47 cents, or 9 percent, to $5.70 in morning trading. Earlier in the session, the stock hit $5.75 — its highest level since June 2012.
