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Gaming Guru

Howard Stutz

Ameristar shares jump amid speculation

23 October 2007

LAS VEGAS, Nevada -- A filing with the Securities and Exchange commission by the majority shareholder of Ameristar fueled speculation on Wall Street Monday that the Las Vegas-based casino operator is up for sale.

The estate of company founder Craig Neilsen, who died in November 2006, said Monday it might pursue one or more strategic alternatives for its nearly 55 percent stake in the casino operator.

Neilsen's estate owns 31.5 million shares of Ameristar, which is traded on the Nasdaq National Market. In the filing, the estate said it may consider a sale of all or part of its holdings in the company, or participate in a merger or other business transaction that could change control of Ameristar.

The news sent shares of Ameristar to $28 a share Monday by the close of trading, an increase of $3.34 over Friday's close or a jump of 13.54 percent.

More than 2.4 million shares were traded, almost seven times the average daily volume.

The filing took place before the opening of trading Monday. By midmorning, Ameristar released a statement saying it was business as usual for the regional casino operator, which owns casinos in Northern Nevada, Missouri, Iowa, Mississippi and Colorado. Last month, the company completed a $675 million purchase of the Resorts East Chicago riverboat casino in Indiana.

"We read the filing to indicate the estate wishes to preserve various options regarding its holdings in Ameristar stock," John Boushy, Ameristar's CEO and president, said in a statement.

Neilsen founded Ameristar and served as its chairman and CEO until his death.