The Deal: Third Bidder Approached MTR

NEW YORK (The Deal) -- Jacobs Entertainment continues to pursue a spoiler bid for MTR Gaming Group  (MNTG) as an alternative to that company's pending $145 million merger with private Eldorado Resorts, but yet another party has entered the bidding. 

The proxy for the Eldorado deal was filed Monday with the Securities and Exchange Commission under the legal entity Eclair Holdings Co. The Eldorado deal of Sept. 9 values the target at $5.15 in a mix of cash or new equity in the combined MTR and Eldorado. Jacobs Entertainment, which previously had offered itself as a target for MTR, made a spoiler bid based on a multiple of MTR's trailing EBITDA that would place a value of $5.69 on the gaming company. 

MTR has casino operations in West Virginia, Ohio and Pennsylvania. Eldorado operates in Nevada and Louisiana, Jacobs has casinos in Colorado, Nevada, Virginia and Louisiana. Jacobs, which is privately held, owns 18% of MTR through its founder Jeffrey Jacobs. 

The proxy for the merger with Eldorado relates that another company, called company Z in the document, approached MTR in late October with an unsolicited bid between $5.25 and $5.50 per share for MTR. That offer is conditioned on due diligence but not any financing condition. Company Z is identified as a strategic buyer. 

MTR, on its Tuesday conference call, declined to comment on the process as its board mulls the offers. 

Both Jacobs and company Z have entered into confidentiality agreements with MTR. 

Jacobs previously claimed its proposal gives Eldorado a 55% share of the merged gambling operations and offers better geographic diversity, tax benefits, and swifter regulatory approvals than the Eldorado combination. 

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