Penn National Looking into Buying Harrah's

Penn National Gaming Inc. might get a whole lot bigger.

The company, along with hedge fund D.E. Shaw, is reportedly considering making a cash and stock offer for casino giant, Harrah's Entertainment, Inc. According to a CNBC report on Tuesday, bankers Lehman Brothers and the Wachovia Corp. would provide financing and would receive some form of equity if the deal goes through.

If the bid for Harrah's materializes, it will be the second bid the company has received in recent months. The company originally turned down an initial offer of $15.05 billion from private equity firms Apollo Management Group and the Texas Pacific Group. Unwilling to accept the bid's rejection by Harrah's, the two groups have since raised the proposed bid to $15.5 billion.

According to a recent Wall Street Journal article, officials from Penn National, Harrah's, and their investment bankers are meeting this week in Las Vegas to examine Harrah's operations. Penn National owns several casinos and horseracing tracks, including Penn National Race Course in Pennsylvania.

The news of the possible bid saw Harrah's shares jump 55 cents to $79.01 on the New York Stock Exchange, while Penn shares fell 76 cents to $37.40 in Wednesday morning trading on the Nasdaq.

Representatives from Penn National Gaming could not be reached.

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