Station Casinos management (the Fertitta family) and Colony Capital took the company private in 2007 and the partnership is now struggling to pay down billions of dollars of debt associated with its buy out of the formerly public company. Boyd's initial offer was made in February, after Station and some of its lenders offered up a prepackaged bankruptcy proposal that would pay bondholders pennies on the dollar. Boyd argued that its offer "would present a superior recovery to the unsecured creditors of Station versus the current Exchange Offer."

Boyd's offer was for Texas Station, Aliante Station, Santa Fe Station, Green Valley Ranch, two Fiesta casinos and other assets. Boyd also said it would be willing to make an offer for the rest of the 18-casino operation as well should it be considered for sale. Boyd has approximately $2 billion in available liquidity under its revolving credit facility.

In dismissing the Boyd's offer Station cited its "highly conditional nature" and "risks…in sharing and confidential information with a significant competitor" and "the uncertainties associated with… obtaining necessary third party consents and required regulatory, antitrust and other governmental approvals." In countering the dismissal, Boyd says it hasn't been given the opportunity to provide Station with a firmer offer.

"To date, Station has not engaged Boyd Gaming in any discussion regarding the proposal, nor has it provided any information that would enable Boyd Gaming to consider submitting a binding proposal," the company states in the letter. "The company understands Station's concern of sharing sensitive information and is prepared to work with Station to employ standard and customary due diligence methods to minimize this risk."

Station's would-be prepackaged bankruptcy offers to pay investors 10- to 50 cents on the dollar in secured notes and cash in exchange for some $2.3 billion of existing bonds. Affiliates of the Fertitta family and Colony Capital have agreed to put up as much as $244 million in new capital to maintain their current interests in the company, according to Station Casinos.

Station dismissed Boyd's initial offer the same day it announced reaching a forbearance agreement with some of its lenders and debt holders to delay its debt restructuring. The forbearance expires April 15. The deadline for note holders to vote on the prepackaged bankruptcy plan is April 10, having been extended from Monday, March 2.

"Despite Station's letter, Boyd Gaming remains committed to pursuing a transaction…and is prepared to work with Station in a timely fashion to prepare a formal proposal," Boyd states in its response. "Boyd Gaming reiterates that it has sufficient liquidity under its credit facility to finance a cash transaction. Boyd Gaming further believes that the necessary regulatory and governmental approvals could be obtained in a timely manner."