Los Angeles (Reuters) – The board of the world’s largest casino operator, Harrah’s Entertainment Inc. , has accepted a USD 17.1 billion buyout bid from private equity groups Apollo Management and Texas Pacific Group .

The USD 90-per-share deal announced on Tuesday is still subject to shareholder approval and a regulatory process that could take a year or more.

It marks an end to more than two months of talks that followed a previous USD 81-a-share offer from Apollo and TPG, although Harrah’s said it would seek higher bids over the next 25 days.

„I don’t expect further bids, but anything is possible,“ Chief Executive Gary Loveman told Reuters in an interview.

The private equity firms, which are paying a 35 percent premium to the price of Harrah’s shares at the end of September just before their first offer was announced, will also assume USD 10.7 billion in debt, Harrah’s said.

„It’s a fair price for Harrah’s shareholders. The 25 days allows them to say this is what we came up with on our own, now we are opening it up to others,“ said Robert LaFleur at Susquehanna Financial Group.

Shares of Las Vegas-based Harrah’s, which were halted before the deal was announced, rose 12 cents to USD 82.30 on the New York Stock Exchange before trading was stopped.

The stock has not responded strongly to reports of higher bids due to concerns about the amount of time it will take to complete the deal due to casino licensing requirements, experts have said.

Across the market, many executives have cooperated with moves to take their companies private, lured by big payouts from the change of control and the prospect of escaping the pressure they face when companies are publicly traded.

Loveman said that Harrah’s does not need to access the public capital markets, because of its robust cash flow and large size in the wake of its 2005 acquisition of Caesars Entertainment. „The time and effort it takes to comply with the public markets is not especially helpful to us,“ he said.

The casino sector has been particularly rife with deals as private equity firms seek out new areas to invest hundreds of billions of dollars in new funds.

Station Casinos Inc. announced plans on December 4 for a USD 4.7 billion management-led buyout. Smaller casino operator Penn National Gaming Inc. had also been considering a bid for Harrah’s, according to sources.

„We don’t think today’s deal is the last involving private equity and gaming and see more of it and balance sheet recaps as big themes heading into 2007,“ Bear Stearns analyst Joe Greff said in a research note.

LaFleur said the new Harrah’s owners were likely to sell off some non-core assets, such as the Rio casino off the Las Vegas Strip, which would be more valuable to operators like Penn or Pinnacle Entertainment Inc. .

Loveman said the announced deal does not trigger any asset sales and none are planned at this time.

He also said Harrah’s plans to move forward with long-standing plans to redevelop its holdings on the Las Vegas Strip and in Atlantic City, but said there is no firm time frame for when it will announce final schemes.

Loveman’s strategy for Harrah’s has focused on leveraging the company’s massive customer database, called Total Rewards, to cross-market its nationwide chain of around 39 casinos, which includes brands like Horseshoe, Harrah’s and Caesars.

The company also expects to complete before year-end its acquisition of British casino operator London Clubs International Plc and is developing projects in the Bahamas, Spain and Solvenia.

The two sides said they expect to close the deal within a year, and the buyers will begin paying shareholders‘ interest expenses if the closing is delayed past March 1, 2008.

„They’ve pretty much put their money where their mouth is and said they can get the deal done in 14 months, and they are willing to pay shareholders if it takes longer than that,“ LaFleur said.

A Harrah’s spokesman said the USD 17.1 billion equity value of the deal was based on an update of the outstanding shares it had reported at the end of September, which initially yielded a USD 16.7 billion value.

The deal would rank in the top 10 private equity buyouts this year, which include the USD 21 billion buyout of HCA Inc. and a USD 20 billion deal for Equity Office Properties Trust .