nder the agreements, which require approval of the court overseeing Fontainebleau's bankruptcy proceedings, the casino-and-racetrack operator would be designated as the "stalking horse" bidder in an auction of the project, and all other offers would be evaluated in comparison to its bid.
Penn National agreed to pay us$ 50 million and provide a credit facility of about us$ 51.5 million through February 9. That money could be used to stabilize the unfinished buildings and for other budgeted expenses.
Penn National operates 19 casino and horse-racing facilities in 14 states and Ontario—but none in Las Vegas—and it has benefited from being in a variety of smaller markets. Some industry observers have questioned whether buying the Fontainebleau makes sense because it may cost more to complete—in excess of us$ 1 billion—than the property would be worth. In addition, the number of visitors to Las Vegas is down sharply amid the recession.
The sellers plan to ask the court to set January 15 as the deadline for other bids, with the auction to be held January 21. In midafternoon trading on the Nasdaq Stock Market, Penn National's shares were down six cents at us$ 28.65.