Brief: Gaming merger rumors fly

The Gaming Industry Weekly Report said Circus stock has climbed recently due to speculation that Park Place might acquire the company. Circus stock was at $12.8125, up 43.75 cents, in early afternoon trading today. Park Place was at $6.375, up 18.75 cents.

Prudential Securities analyst Joe Coccimiglio said that because its stock price has declined, Circus is a potential Park Place target.

But Andrew Zarnett of Ladenburg Thalmann said Park Place, the gaming unit recently spun off from Hilton Hotels Corp., is unlikely to make any offer at Park Place's current stock price.

Park Place, which just acquired Grand Casinos Inc.'s three Mississippi operations, has more than three times the number of shares outstanding as Circus.

In an all-stock transaction at current prices, Park Place would have to offer at least 190 million additional shares to acquire Circus without any premium, boosting its total shares out to about 500 million.

Park Place would also have to assume Circus debt, which totaled $2.52 billion as of Oct. 31.

A Park Place spokesman said the company doesn't comment on rumors. Circus executives also declined comment. Both companies are based in Las Vegas.

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