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Station Casinos announced that its management and Colony Capital LLC have proposed a $4.7 billion offer to take the company private, the second largest takeover bid in the casino industry this year. Chairman Frank Fertitta III and his brother, President Lorenzo Fertitta, propose to pay $82/share (a 19% premium) for the company, which owns 12 Las Vegas casinos. Station shares have fallen recently over concern that the number of local casinos exceeds demand, a matter Frank Frantini, publisher of the Gaming Morning Report, downplays as a "short-term Wall Street reaction." Shares of Station rose $15.80, or 23 percent, to $84.90 on the news. Other stocks in the sector rose in anticipation of further takeovers: Boyd shares jumped 11% to $46.70, and Pinnacle Entertainment Inc. increased 6.2 percent to $34.15.
• Sources: Bloomberg, BusinessWeek, Wall Street Journal
• Related commentary: Boyd Gaming Remains Strong Despite Soft Quarterly Results, Valuing the Casino Industry, Wall Street Firms Bet on Casinos
• Potentially impacted stocks and ETFs: Station Casinos (NYSE:STN). Competitors: Harrah's Entertainment (HET), Pinnacle (NYSE:PNK), Boyd's Gaming (NYSE:BYD), Wynn Resorts (NASDAQ:WYNN), Trump Entertainment Resorts (TRMP)

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Source: Fertitta Brothers to Take Station Casinos Private