Tilman J. Fertitta, chairman, president and CEO of Houston-based Landry's and owner of Fertitta Holdings Inc., has told the special committee of the board of directors that the shutdown of its Kemah and Galveston restaurants, deterioration in the casual dining and gaming industries and problems with the credit market mean debt is very difficult to obtain, particularly at the current price per share. He says he is in negotiations with Jefferies & Co. in New York City about financing. In the press release, it was noted Landry's had filed a preliminary proxy to hold a shareholders' meeting Nov. 3.

When the definitive agreement was signed in June, Fertitta Holdings had planned to assume about $885 million of Landry's debt. Furthermore, Fertitta had received financing commitments from Jefferies & Co. and Wells Fargo Foothill LLC of Santa Monica, CA.

Given the turmoil of the credit markets in recent weeks, the release says the $21 per share price is now considered too high for the merger. Calls to Landry's and Fertitta were not returned by deadline.

Analyst Paul Westra with Cowan & Co. LLC in New York City declined an interview with GlobeSt.com. The analyst did, however, provide a written statement noting that "a successful takeover is now less than likely given the troubled financing market." Cowan & Co. is the special committee's financial adviser.

Hurricane Ike caused wind and water damage to the Landry locations. Fertitta Holdings' Kemah Boardwalk remains closed. The boardwalk's first restaurant will reopen in a few weeks, with the project to be fully up and running by spring 2009. Meanwhile, three of Fertitta's seven Galveston restaurants are closed, with their scheduled openings also slated for 2009.