Revel Casino owners file for bankruptcy again
The Revel casino in Atlantic City has filed for bankruptcy for the second time in 15 months. – (AARON HOUSTON)
The owners of Revel Casino Hotel have filed for bankruptcy protection for the second time in 15 months, with an eye toward finding a buyer for the failing Atlantic City resort.
The company announced Thursday that Revel AC Inc. and its subsidiaries filed petitions in the U.S. Bankruptcy Court for the District of New Jersey “to commence a Chapter 11 process to address liquidity issues and facilitate a sale of substantially all of Revel’s assets.” The company expects normal business operations to continue throughout the process.
“Today’s announcement follows an extensive strategic review,” Scott Kreeger, president and CEO of Revel Casino Hotel, said in a news release. “We will work to reach an agreement with a new owner who will help ensure Revel’s long-term financial stability and who shares our commitment to providing Revel’s guests and players an exceptional experience in lodging, gaming, entertainment and recreation.”
The move marks the second bankruptcy filing by Revel since opening a little more than two years ago. It first filed in March 2013, resulting in a process that cut its $1.5 billion in debt by more than 80 percent. It also resulted in investors exchanging debt for equity in the property.
The Associated Press reported Thursday that Revel warned its employees that it will shut down this summer if it a buyer can’t be found for the property. The media outlet cited a letter to the staff that said employees could be terminated as soon as Aug. 18.
“If Revel is unable to complete such a sale promptly, Revel expects to close its entire facility,” the letters read, according to the Associated Press.
In its news release Thursday, the company said it had reached an agreement to obtain a $125 million debtor-in-possession loan, arranged by one of its existing lenders, which is intended to provide Revel with liquidity necessary to operate its business while it pursues a sale through the Chapter 11 process.
The towering $2.4 billion casino hotel — which opened to great fanfare in 2012 —has fallen far short of changing the fortunes of Atlantic City as stakeholders had hoped. The property has lost more than $260 million since opening, according to data from state regulators.
Burd Joshua (2014 June 19) Revel Casino owners file for bankruptcy again. Retrieved on June 20, 2014 from njbiz.com