NEW YORK (KMOX/AP) – What are the odds that Pinnacle Entertainment Inc.’s $869 million bid for competitor Ameristar Casino Inc. will hit the jackpot? The Federal Trade Commission says that bet would violate United States anti-trust law, and hurt consumers.
The agency on Wednesday moved to block the deal.
The FTC said the deal would reduce competition and could lead to higher prices and lower quality in St. Louis, where both companies have casinos.
Pinnacle agreed to buy Ameristar in December in a deal that would more than double its size. If the sale goes through, it will also take on $1.9 billion of Ameristar’s debt. Pinnacle has casinos in Louisiana, Missouri and Indiana and a racetrack in Ohio, while Ameristar has casinos in Missouri, Iowa, Colorado, Mississippi, Indiana, and Nevada.
The FTC said it will seek a restraining order and preliminary injunction to stop the purchase. The hearing will go before a judge on Oct. 28.
Pinnacle said it was disappointed with the FTC’s decision and is committed to completing the deal.
Shares of Pinnacle Entertainment fell $1.70, or 8.2 percent, to close at $18.92. Ameristar shares slipped 33 cents, or 1.5 percent, to $25.91.
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