Columbia Entertainment has a definitive agreement to acquire Casino Queen, a privately owned hotel and casino complex in East St. Louis, Illinois, for $200 million in cash. The transaction has been approved by Casino Queen shareholders and will receive initial consideration by the Illinois Gaming Board.

Columbia Entertainment plans to transform the Casino Queen from a riverboat casino into a state-of-the-art land-based casino with a floating casino floor, located directly across from the St. Louis Gateway Arch. Columbia Entertainment expects to invest approximately $60 million in the development of this property, which upon completion will be a new 138,000 square foot, Southwestern-themed gaming facility, including a 40,000 square foot casino, buffet, steakhouse, cafe and gift shop.

The Casino Queen will complement Columbia Entertainment’s current portfolio of 8 casinos in Nevada, Mississippi and Louisiana. In addition, on May 19, 2006, Columbia Entertainment agreed to acquire Aztar Corporation, which includes the Tropicana casino resorts in Atlantic City and Las Vegas, the Ramada Express casino hotel in Laughlin, Nevada, and the Casino Aztar riverboat casino in Evansville, Indiana. Following the completion of the Casino Queen and Aztar transactions, the Company will own and operate a total of 13 casinos in Nevada, Louisiana, Mississippi, New Jersey, Illinois and Indiana, in addition to building a new resort and casino property in St. Maarten.

William J. Yung III, President and CEO of Columbia Sussex said, “We are excited about this acquisition which, along with our agreement to acquire Aztar, will transform our gaming business. Casino Queen is a terrific asset and we see tremendous opportunities to use our significant operating experience to build the franchise and further expand Columbia’s position as one of the leading owners, developers and operators of hotels, resorts and casinos.”

The transaction is subject to customary closing conditions, including the receipt of necessary regulatory and governmental approvals. The transaction is expected to close by the end of 2006.

Columbia Entertainment obtained its first gaming license in 1990 and has been licensed and re-licensed numerous times in Nevada, Louisiana and Mississippi. The Company has applied for a gaming license in Illinois to complete the Casino Queen transaction, and is in the process of seeking gaming licenses in New Jersey and Indiana to complete the Aztar transaction.
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