Penn National updates progress of merger with Fortress, Centerbridge

By Lisa Kerner

Charlotte, N.C., Jan. 16 - Penn National Gaming, Inc. said it plans to close the pending merger transaction with Fortress Investment Group LLC and Centerbridge Partners, LP late in the second quarter.

The timing of the closing is subject to obtaining regulatory approvals and other customary closing conditions, according to a form 8-K filing with the Securities and Exchange Commission.

Penn National provided an update on the approval process:

• Aug. 15 - all initial regulatory applications and documents filed;

• November - approval granted by the Ohio Racing Commission;

• December - hearing in front of the Illinois Gaming Board;

• December - Hart-Scott-Rodino waiting period ends without a second request; and

• February - Fortress and Centerbridge to appear before the New Jersey Racing Commission.

In addition, Penn National, Fortress and Centerbridge took action to reduce the amount of "gross-up" payments pertaining to federal excise taxes, including payment to all corporate employees of annual bonuses for 2007 on or before Dec. 31.

As previously reported, Penn National shareholders approved the $8.9 billion acquisition of the company at a special meeting in December. With 81.6% of Penn National's outstanding shares voting, 99.3% of the shares were voted in favor of the transaction.

Under the companies' agreement, if the merger is completed by June 15, Penn National shareholders will be entitled to receive $67.00 cash per share.

If the merger is not completed by June 15, the $67.00-per-share merger consideration will be increased by $0.0149 per day, a prior news release stated.

Penn National, located in Wyomissing, Pa., owns and operates casino and horse racing facilities.

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