Three people or groups are reportedly bidding in the
Revel casino bankruptcy auction Wednesday in New York, including Florida
investor Glenn Straub who set the baseline for the auction with a $90 million
offer.
Reuters, citing an unnamed person familiar with the
auction process, said two last-minute bids came Tuesday, one from a party
involved in casinos outside of New Jersey and a second from a real estate
developer.
It's not clear if any of the two additional bids were
"qualified," which means they were deemed likely to go to closing if
they came out on top.
The auction is a closed-door affair with lawyers and
others running between potential buyers to solicit higher offers, rather than
an auctioneer with a gavel in a crowded room.
The auction also could be interrupted by the start of the
Jewish holiday Rosh Hashanah at sundown Wednesday.
Among the bidders may be Richard Meruelo, a real estate
developer with interests in South Florida and Southern California. Meruelo was
at a Sept. 15 Revel bankruptcy hearing, complaining that his company's bids
were not considered "qualified" in previous attempts to sell Revel in
a bankruptcy auction.
At that hearing, Meruelo expressed continued interest in
buying Revel, but objected to the $3 million breakup fee that would go to
Straub if he won the auction. The minimum bid to beat Straub is $94 million.
Meruelo is part of a family that has made at least two
previous attempts to enter the Atlantic City casino market.
Alex Meruelo's Meruelo Group, which owns the Grand Sierra
Resort & Casino, in Reno, Nev., tried to buy Trump Plaza last year for $20
million. Carl Icahn, who owns the mortgage on Trump Plaza and Trump Taj Mahal,
blocked that deal because he thought the offer too low.
Belinda Meruelo, the mother of Richard and Alex, tried to
buy the Atlantic Club in a bankruptcy auction, bidding $24.5 million, slightly
more than the $23.6 million combined winning bid by Tropicana and Caesars.
In a bankruptcy auction, the property goes not
necessarily to the highest bid, but to the "highest and best" bid.
Atlantic Club's lawyers and investment bankers gave the nod to Caesars' and
Tropicana's combined bid for reasons that were not disclosed.
Typically, a bid is less desirable if it has conditions
on it or depends on insecure financing.
In the case of Revel, Straub's bid is particularly strong
because its an all-cash offer and is not contingent on Straub receiving a
license to operate a casino at the property.
John K. Cunningham, Revel's lead bankruptcy attorney,
said at the Sept. 15 hearing that he and his colleagues would consider any
qualified offers.
If they get a $200 million offer with a casino-licensing
contingency, they would have to weigh how long the licensing process would take
against the fact Revel is burning through $5 million to $6 million in cash a
month - about half from property taxes - even after closing.
"We're not cutting anybody out," he said.
Source: Philly.com
No comments:
Post a Comment