Last year Kentucky-based Columbia Sussex outbid Pinnacle and Penn National Gaming in the auction for the bankrupt President Casino in St Louis, Missouri. The company had planned to replace the River Mississippi casino on the Admiral with a new boat to the south, but the $57 million deal is off amid speculation over the company’s ability to obtain a gaming licence in Missouri.

Columbia Sussex operates three casinos in Nevada, including one in Las Vegas, and others in Louisiana and Mississippi. The company withdrew its application to the Missouri Gaming Commission for a casino operating licence on Monday, and has been quoted as informing surprised President officials that its decision was because "any further efforts to obtain its license would be futile." According to documents filed last week in a bankruptcy court, a creditors group alleges the Gaming Commission staff had advised the board to deny the licence, but the judge denied a request that the Commission be compelled to provide details of its investigations.

In December last year Columbia Sussex appealed to the St. Louis mayor after the Land Clearance for Redevelopment Authority (LCRA) filed suit to prevent it from building a parking garage across from the President Casino. The company claimed that if the suit prevailed lack of parking facilities would effectively put the casino out of business. Approval was afterwards granted for moving the replacement casino boat a few blocks further south where a parking garage could be built.

Pinnacle Entertainment has already commenced construction of a $400 million casino complex in St. Louis. Whether it would consider making another bid for the bankrupt President is unknown. The move to abandon the deal has caught President Casinos by surprise, as has the question of Columbia Sussex’s ability to gain a Missouri gaming licence. If the company satisfied the rigorous screening by Nevada, Louisiana and Mississippi authorities then an additional licence in Missouri should not have posed a problem. (E-10.26.05)

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