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Howard Stutz

Vegas company to pay $43 million for Indiana casino

14 September 2010

RISING SUN, Indiana -- Las Vegas-based Full House Resorts said Monday it would spend $43 million to acquire a casino in Indiana, further cementing the company's stake in the Midwest gaming market.

Full House, best known for having former auto industry executive Lee Iacocca on its board of directors, will acquire the Grand Victoria Casino & Resort in Rising Sun, Ind. Full House is publicly traded on the American Stock Exchange.

The Grand Victoria, which is on the Ohio River, competes for customers in Southern Indiana with a property in Lawrenceburg operated by Penn National Gaming and the Beltarra casino, which is owned by Pinnacle Entertainment.

By 2012, the property could face competition from a casino in Cincinnati that will be operated by Harrah's Entertainment.

The Grand Victoria has 37 table games, 1,382 slot machines and a 201-room hotel.

Full House operates the FireKeepers Casino in Battle Creek, Mich., for the Nottawaseppi Huron Bank of Potawatomi Indians. The casino, which has almost 2,700 slot machines and 78 table games, is located off Interstate 94 between Chicago and Detroit.

Full House also operates the Stockman's Casino in Fallon and a racetrack casino in Delaware. The company is also exploring other Indian gaming opportunities.

Full House CEO Andre Hilliou said the Indiana casino is within driving distance of Cincinnati, and is near Lexington, Ky., and Louisville, Ky.

Analysts said the sale, which they estimated at a multiple of a little more than five times the property's cash flow, shows casino deals can take place in a challenging economic environment.

"This apparent low acquisition multiple may be a function of a buyer capturing forthcoming competitive risk from Harrah's in Cincinnati and accelerating risk from Penn's expansion," Union Gaming Group principal Bill Lerner told investors. "In addition, gaming expansion in Kentucky appears highly likely in the next few years."