Ameristar buying bankrupt Colo. casino

Wednesday, June 2, 2004 | 10:57 a.m.

SUN STAFF AND WIRE REPORTS

BLACK HAWK, Colo. -- A Las Vegas-based gambling company has signed a deal to buy the bankrupt Mountain High Casino in Black Hawk for $115 million.

Ameristar Casinos Inc. said it reached the deal Tuesday with Windsor Woodmont Black Hawk Resort Corp. It includes the assumption of Windsor Woodmont's liability for approximately $2.4 million in bond principal.

Ameristar said it plans to make $75 million worth of improvements to the property, including construction of a 300-room hotel, more parking and gambling equipment upgrades.

"We are very excited about the opportunity," said Craig Neilsen, president and CEO of Ameristar. "Mountain High is a high-quality property with an attractive and distinctive design and an excellent location in one of the major gaming markets in the United States."

Ameristar Casinos owns six other casinos, most of them in the Midwest and South. Ameristar said its acquisition will form the basis of Windsor Woodmont's amended plan of Chapter 11 reorganization.

The deal, subject to approval by bankruptcy court and regulators, is expected to close in the fourth quarter of 2003.

Standard & Poor's Ratings Services today said its ratings and outlook on Ameristar Casinos would not be affected by news of the purchase. Ameristar's debt leverage is expected to remain within a similar range by the end of fiscal 2004, the agency said.

Mountain High Casino is one of several in Black Hawk, 40 miles west of Denver and one of three Colorado towns where gambling is legal. It is the largest casino in Colorado, with approximately 425,000 square feet, 1,000 slot machines and 24 table games.

The gambling hall was called the Mountain High Casino by Hyatt when it opened in December 2002. It was in trouble less than a year later. Windsor Woodmont reported $152.5 million in debt when it filed for bankruptcy, accusing Hyatt Gaming of mismanagement. It later paid Hyatt $18.4 million to end a 20-year management agreement.

Last month, Golden Gaming of Las Vegas announced that it was acquiring another Black Hawk casino, the Mardi Gras, from a group of investors.