M&A

23 November, 2009

UPDATE 2-Icahn outbids Penn for Fontainebleau Las Vegas

LOS ANGELES, Nov 23 (Reuters) - Financier Carl Icahn has offered $156.5 million to acquire the partially-built Fontainebleau Las Vegas resort, which has been stalled in bankruptcy court since June, according to a spokesman for rival bidder Penn National Gaming (PENN.O).

Penn, which said last week that it had offered $101.5 million, including $51.5 million of debtor-in-possession financing, for Fontainebleau, has raised its bid to $145 billion, said spokesman Joe Jaffoni.

Both of the bids dwarf the $2 billion that has already been spent on the 3,800-room casino resort, which sits toward the northern end of the Las Vegas Strip. The property is expected to go to auction in January.

Icahn, whose bid could represent a "stalking horse" floor for the auction, was not immediately available for comment.

The financier acquired in 1998 the Strip's Stratosphere hotel and casino out of bankruptcy, but in 2007 sold that property, along with three smaller casinos, to Goldman Sachs (GS.N) for $1.3 billion. (Reporting by Deena Beasley; Editing by Tim Dobbyn) ((deena.beasley@thomsonreuters.com; 1-213-955-6746))

Source: http://www.reuters.com