UPDATE 2-Landry's agrees to be bought by CEO for $1.4 bln

* New offer at $24/shr vs prior bid of $21/shr

* Transaction valued at $1.4 bln

* Co says deal subject to dismissal of lawsuit

* Co’s special committee to seek superior offers

* Shares up 10 pct (Adds details, background, share movement)

May 24 (Reuters) - Landry's Restaurants Inc's LNY.N Chief Executive Tilman Fertitta concluded a nearly two-year-long bid for the company on Monday, after the seafood restaurant operator agreed to be bought for $24 a share, or $1.4 billion, in cash.

Landry’s shares were up 10 percent at $23.82 in morning trade on the New York Stock Exchange.

CEO Fertitta’s sweetened bid, at an 11 percent premium to the company’s Friday close, comes nearly a month after his previous enhanced bid in April. [ID:nSGE63Q0IP]

However, a special committee -- set up to look into strategic alternatives for Landry’s -- said it will actively seek superior offers over the next 45 days.

Landry’s operates the iconic Golden Nugget Hotel & Casino in Las Vegas and several casual dining outlets including Landry’s Seafood House in Texas and 30 other states.

It said Fertitta will buy all of Landry’s outstanding stock that he doesn’t already own as part of the deal to take the restaurant private. As of Sunday, May 23, Fertitta owned about 55 percent of Landry’s stock, the company said in a statement.

Fertitta’s attempts to take Landry’s private have been resisted in the past by both the company’s board and shareholders including Pershing Square Capital Management LP, which is headed by activist investor William Ackman.

In November 2009, Pershing Square reported a 9.6 percent stake in Landry’s and said it will not support a planned takeover of the restaurant chain by Fertitta. [ID:nBNG219863]

Landry’s, which has been looking for strategic alternatives, has also rejected several offers by Fertitta, terming them as inadequate.

Fertitta’s first bid came in June 2008, but later that year, Landry’s said Fertitta may not be able to fund the takeover.


On Monday, Landry’s said it reached a partial agreement to settle derivative and other claims against Fertitta and his affiliates, and certain company directors in a lawsuit pending in Delaware. [ID:nWNAB3123]

Landry’s said the deal will be conditioned upon the dismissal of the lawsuit with prejudice of such claims.

The company said its special committee had asked shareholders to vote in favor of the deal. (Reporting by Shradhha Sharma in Bangalore; Editing by Mike Miller)