News Details

RENO, Nev. and LAS VEGAS, July 9 -- International Game Technology (NYSE: IGT) and Anchor Gaming (Nasdaq: SLOT) announced today that the Boards of Directors of both companies have unanimously approved a definitive agreement pursuant to which Anchor Gaming will merge with a subsidiary of International Game Technology ("IGT"). This tax free, stock for stock transaction is valued at $1.365 billion, based on IGT's July 6, 2001 closing price of $59.20 and the assumption of indebtedness of $430 million at March 31, 2001. Based on that price, Anchor Gaming shareholders would receive one share of IGT Common Stock for each share of Anchor Gaming. The exchange ratio is subject to a collar as described below. The transaction will be accounted for on a purchase basis and is expected to be accretive to IGT's earnings. The combination creates a company with total combined annual revenues in excess of $2 billion.

As part of the transaction, Thomas J. (T.J.) Matthews will, at closing, join IGT as its Chief Operating Officer and will continue as President and Chief Executive Officer of Anchor Gaming. Upon closing of the transaction, two new directors will be added to the IGT Board of Directors, one of whom will be T.J. Matthews.

"We are very enthusiastic about this business combination," said G. Thomas Baker, President and Chief Executive Officer of IGT. "IGT and Anchor Gaming have been joint venture partners since 1996 on the very successful Wheel of Fortune^® product. Upon closing, IGT will be able to recognize 100% of the joint revenue and profits previously shared by the companies. This is a significant strategic benefit. We are also very excited about the addition of Anchor Gaming's significant executive talent which will contribute to the further growth of IGT."

"No other company offers the depth of talent that IGT and Anchor Gaming will have together, from the executive level to design and manufacturing," said T.J. Matthews, Chairman, President and Chief Executive Officer of Anchor Gaming. "We are looking forward to the many possibilities that the combination presents."

Under the terms of the collar contained in the definitive agreement, each share of Anchor Gaming will be converted into one share of IGT subject to a collar from $50.00 to $75.00 per share. Under the collar mechanism, if IGT's average stock price exceeds $75.00 per share during the 20-day trading period ending the third business day prior to Anchor Gaming's shareholder vote on the merger, IGT will have the right to terminate the merger agreement, subject to Anchor Gaming's right to elect to accept a lower exchange ratio such that the value of the stock received by Anchor Gaming shareholders equals $75.00 per share. In addition, if IGT's share price during the 20-day trading period ending three business days prior to Anchor Gaming's shareholder vote on the merger is less than $50.00 per share, Anchor Gaming will have the right to terminate the merger agreement subject to IGT's right to provide a higher exchange ratio such that the value of the IGT stock received by Anchor Gaming shareholders equals $50.00 per share.

The merger is subject to the approval of both companies' shareholders and regulatory approvals, including gaming regulatory approvals. The companies anticipate that the transaction will be completed in the first calendar quarter of 2002.

Houlihan Lokey Howard & Zukin provided a fairness opinion to IGT and Dresdner Kleinwort Wasserstein acted as financial advisor to Anchor Gaming.

International Game Technology is hosting a conference call regarding its acquisition of Anchor Gaming at 8:00 a.m. Pacific Daylight Time on Monday, July 9, 2001. The access numbers are as follows:

Domestic callers dial 888-282-0413, passcode IGT International callers dial 630-395-0446, passcode IGT

This conference call will be broadcast live over the Internet, simply log on to the Internet at the following address to access the call:

     What:    Conference Call - International Game Technology
              Announces Agreement to Acquire Anchor Gaming
     When:    Monday, July 9, 2001 at 8:00 a.m. (Pacific Daylight Time)
     Where:   http://www.videonewswire.com/IGT/070901/
     How:     Live over the Internet -- Simply log on to the web address above
     Contact: Robert McIver 775-448-0110

Minimum Requirements to listen to broadcast: The RealPlayer software, downloadable free from http://www.real.com/products/player/index.html, and at least a 14.4Kbps connection to the Internet. If you experience problems listening to the broadcast, send an email to webmaster@vdat.com.

If you are unable to participate during the live webcast, the call will be archived on the Web site http://www.igt.com. To access the replay, click on IGT Investors, FAQ page. The call will also be archived at http://www.prnewswire.com.

Interested parties not having access to the Internet may listen to a taped replay of the entire conference call commencing at approximately 10:30 a.m. (Pacific Daylight Time) on Monday, July 9, 2001. This replay will run through Tuesday, July 17, 2001. The access numbers are as follows:

Domestic callers dial 800-477-4783 (no reservation number required)

International callers dial 402-998-0883 (no reservation number required)

Statements in this release regarding IGT, which are not historical facts, are "forward-looking" statements under the Private Securities Litigation Reform Act of 1995. These matters involve risks and uncertainties, including changes in demand for the companies products because of a reduction in the growth of markets or changes in the popularity of its products, a decrease in the popularity of its wide area progressive systems, the risks of conducting international operations, the adoption of new unfavorable gaming laws or laws applicable to gaming machine manufacturers and uncertainties generally associated with the development and manufacturing of gaming machines and systems. Historical results achieved are not necessarily indicative of future prospects of IGT. More information on factors that could affect IGT's business and its financial results are included in its Annual Report on Form 10-K and other public filings made with the Securities and Exchange Commission. For more information on International Game Technology, visit the IGT company web site at http://www.igt.com.