ATLANTIC CITY, N.J. Six months after
exiting bankruptcy court, Atlantic City's newest casino may be up for sale --
or headed back to bankruptcy.
Revel Casino Hotel says it is pursuing "strategic
alternatives," which in this gambling resort town usually means the
property is being marketed for sale, or considering a bankruptcy filing. But
the company stressed it has not decided on any specific course of action, and
cautioned it is possible that no transaction will result from the exercise.
Revel, now under new ownership led by Chatham Asset
management, won't say what options are under consideration.
"Revel has not made any decision to pursue any specific
strategic transaction or alternative, and there can be no assurance that the exploration
of strategic alternatives will result in the consummation of any
transaction," the company said in a statement issued late Friday night.
"Revel does not intend to comment further regarding its evaluation of
strategic alternatives until such time as the board has determined the outcome
of the process or otherwise has deemed that disclosure is appropriate."
Since it opened in April 2012, the $2.4 billion casino-hotel
has struggled in the cutthroat East Coast casino market. Once eagerly awaited
as the potential savior of Atlantic City, it operated less than a year before
filing for Chapter 11 bankruptcy protection in March. That transaction wiped
away $1.2 billion of its $1.5 billion in debt, in return for granting lenders
an 82 percent ownership stake.
Revel exited bankruptcy court in May and set out to boost
its casino business, which has remained stuck near the bottom of the city's 12
casinos. But that went awry, with a widely promoted "you can't lose"
slots promotion angering many customers who thought their losses would be
refunded in cash. Instead, they were gradually credited to a Revel player
account over a period of several months, with restrictions on when they could
be used.
For the first nine months of this year, Revel ranks eighth
among the city's 12 casinos in terms of the amount of money won from gamblers,
at $116.3 million. October figures are due out on Tuesday.
Revel also announced it has received additional financing
and it intends to operate normally while it considers its future.
One of the advisers it hired last week helped it through its
bankruptcy case in March. Moelis & Co. also helped the Tropicana Casino and
Resort look for a buyer in bankruptcy court in 2009, eventually helping it
complete a sale to Carl Icahn.
When Revel opened, its owners viewed it as a destination
resort that just happened to have a casino, and marketed the property to
high-end leisure travelers and companies seeking to book group events. Some
customers complained its restaurant prices were too high and took their
business elsewhere.
After the bankruptcy, new ownership led by Chatham Asset
management, part of a lender group, took over.
The casino set out to increase its share of the gambling
market and appeal to lower-end customers. A day before the "strategic
alternatives" announcement was made, Revel issued a press release about
low-cost dining options; one of its restaurants offers breakfast for $3.99, including
eggs, bacon and potato wedges.
Source: CBS
News
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