Final bids were due yesterday for Revel as Atlantic City’s newest casino resort, currently mired in its second chapter 11 proceeding, seeks a buyer, the Associated Press reported yesterday. Last month, Atlantic City Mayor Don Guardian said that there are six potential buyers for the Revel Casino Hotel, which is up for sale at a bankruptcy auction.
Caesars Entertainment Corp., the casino company taken private in a $30.7 billion leveraged buyout just before the credit crisis, has taken steps in recent weeks that signal that it’s poised for a massive debt restructuring that will saddle creditors with steep losses, Bloomberg reported today. “We expect that something is imminent,” Alex Bumazhny, a credit analyst with Fitch Ratings. Fitch, which has a CCC rating on Caesars that is reserved for borrowers where “default is a real possibility,” said that it expects the company to attempt a debt-for-equity exchange with a group of junior creditors. Caesars, with properties from Caesars Palace in Las Vegas to Harrah’s in Atlantic City, has had only one profitable year since 2008 as it struggles to service $21 billion of long-term debt amid a drop in consumer spending. Bondholders have suffered losses of $2.6 billion since September as the company gained regulatory approval for a refinancing that shielded valuable assets from lenders. Last week, advisors to a group that owns senior bonds of a Caesars unit entered into talks to restructure its borrowings. The events are putting Las Vegas-based Caesars on a path toward a $12.7 billion debt restructuring that pits Leon Black and David Bonderman, the buyout titans who took the company private with a $6 billion equity investment, against distressed-debt investors.
Revel AC Inc., whose Atlantic City, N.J., casino has been in bankruptcy twice since it opened in 2012, won permission to pay executive bonuses of as much as $1.75 million tied to the sale of its business, Bloomberg News reported yesterday. U.S. Bankruptcy Judge Gloria M. Burns at a hearing yesterday authorized the company to make the bonus payments after the resort’s fate is determined at an auction set to be held next week. The company’s struggles illustrate the larger issues facing Atlantic City, which has already seen the Atlantic Club close and may have two other casinos shut down by the end of September. Caesars Entertainment Corp. plans to shutter the Showboat on Aug. 31 and the Trump Plaza Hotel & Casino said it plans to end operations on Sept. 16.
Bankruptcy Judge Magdeline D. Coleman approved the liquidation plan of the partnership behind the failed Foxwoods Casino project in South Philadelphia, Philly.com reported yesterday. The Foxwoods group, formally known and Philadelphia Entertainment & Development Partners L.P., has huge debts, including $55 million or more owed to RBS Citizens for a loan on land that has since been sold. Additional unsecured debt amounts to nearly $24 million. The only significant asset Foxwoods has is a claim — the subject of a related lawsuit — that Pennsylvania should return the $50 million license fee it paid in 2007.
About a quarter of the casino jobs that propped up Atlantic City, N.J., for more than three decades are on the line as one gambling house closed in January, two more plan to in the next two months and a fourth — the $2.4 billion Revel that promised to transform the town from a bastion of gamblers into a destination for the glitterati — is seeking a buyer in bankruptcy, Bloomberg News reported today. Once the East Coast’s gambling hub, Atlantic City has suffered as casinos opened in neighboring states including Pennsylvania and New York after they legalized gambling or expanded betting to increase tax revenue. Even as Caesars Entertainment Corp. plans to close its money-losing Showboat casino in New Jersey, it’s opening the Horseshoe in Baltimore next month. The city’s 11 gambling houses account for almost half its jobs: 5,883 positions in a workforce of 13,500. The Atlantic Club closed in January, putting 1,600 people out of work. The shuttering of Caesars’ Showboat on Aug. 31 will wipe out 2,133 jobs. Trump Plaza Hotel & Casino said it plans to close Sept. 16, taking away another 1,009. Revel employs 3,106 people. About one-fifth of the 30,000 people registered as casino workers with the state Division of Gaming Enforcement live in Atlantic City, the most in a single zip code.
The bankruptcy court overseeing the chapter 11 proceeding of Revel AC Inc. approved bid procedures for the company that would see qualified bids submitted by Aug. 4, an auction, if one is required, on Aug. 7, and a sale hearing on Aug. 8, according to a court order, LeveragedLoan.com reported yesterday. Letters of intent to bid are due by July 18, the order said. The auction would take place at the New York offices of the company’s counsel, White & Case, and the sale hearing at bankruptcy court in Camden, N.J. According to the July 14 order, lenders under the company’s DIP facility and its pre-petition first-lien credit agreement will be permitted to credit bid.
A bankruptcy judge on Friday pushed back a decision on a proposal to auction Atlantic City-based Revel Casino Hotel, which last month filed for chapter 11 protection while it searches for a buyer, Dow Jones Daily Bankruptcy Review reported today. During a bankruptcy court hearing, Revel and its unsecured creditors were unable to come to terms over disputes involving the right of Revel's lender to credit bid as well as the timeline for submitting bids.
A New Jersey state assemblyman said that the struggling gaming industry in Atlantic City faces another blow as the Trump Plaza casino prepares to tell workers it may close in September, Bloomberg News reported on Saturday. Trump Entertainment Resorts Inc. lawyers said on Friday that the property may shutter as soon as Sept. 16, said Assemblyman Vincent Mazzeo, a Democrat who represents Atlantic City in the state legislature. Notices will be sent to 1,000-plus workers as soon as this week warning them of the possible closure, he said. Trump Plaza would join a roster of Atlantic City casinos buckling under as the resort community has yet to rebound from the worst U.S. recession since World War II. The Atlantic Club casino closed in January, Caesars Entertainment Corp. announced it will shut down its Showboat property on the city’s boardwalk Aug. 31, and Revel, a $2.4 billion mirrored-glass casino that was supposed to usher in an era of opulence and resurgence for the city, is searching for a buyer in bankruptcy.
The trustee in charge of Jeffrey Soffer's failed Fontainebleau Las Vegas casino project has struck a settlement that would put more than $83 million of directors and officers insurance money into creditors' pockets, Dow Jones Daily Bankruptcy Review reported today. In a filing with U.S. Bankruptcy Court in Miami, lawyers for chapter 7 trustee Soneet R. Kapila said that the settlement also removes $675 million in claims against the Fontainebleau estate.
Caesars Entertainment Corp. said on Friday that it would close the Showboat casino-hotel in Atlantic City this summer, dealing another blow to a resort city already reeling from increased competition and a years-long decline in gambling revenue, Dow Jones Daily Bankruptcy Review reported today. Las Vegas-based Caesars cited a continued decline in business in the market, along with what it said was the high property-tax burden in Atlantic City. Showboat will be fully operational until it closes on Aug. 31, and it will honor all room reservations and events until that time, the company said.