Lawyers will meet in effort to save Revel deal

In a last-ditch effort to salvage the sale of the former Revel Casino Hotel in Atlantic City to Brookfield Asset Management for $110 million, Revel's bankruptcy attorney has scheduled a meeting Monday in New York to pursue negotiations.

Only it is not clear if Brookfield will be there.

"I'm going to make a request to Brookfield to be there. All I can do is try," Revel's attorney, John K. Cunningham, told U.S. Bankruptcy Judge Gloria M. Burns.

Brookfield, a Toronto real estate investment manager, said Wednesday that it was walking away from the deal because it couldn't reach a suitable agreement with bondholders of ACR Energy Partners L.L.C., which owns Revel's central utility plant.

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Melissa Coley, a spokeswoman for Brookfield, declined to comment.

Cunningham told Burns that Revel had not yet received a formal termination notice, seemingly leaving room for a negotiation before Brookfield's asset purchase agreement expires next Friday.

Brookfield did not have a representative at Friday's hearing, but Cunningham told the judge that he had been in touch with Brookfield's attorney and was assured that the lines of communication remain open.

"Personally, I think they will engage," Cunningham, of White & Case L.L.P., told Burns, speaking of Brookfield.

Burns suggested that a mediator could help negotiate a deal between Brookfield, ACR, and ACR's municipal bondholders.

The bondholders were represented at Friday's hearing by an attorney for Bank of New York Mellon, the trustee for the ACR bonds, which total $118.6 million - more than Brookfield agreed to pay for Revel.

The attorney, P. Bradley O'Neill, said the dispute was commercial in nature and did not require a mediator.

"We don't see ourselves at an impasse," O'Neill told the judge.

Revel has a deal with ACR under which its fixed debt and equity payments to ACR total $20.1 million annually. The bankrupt casino company also agreed in 2011 to pay $4 million annually to ACR for operations and maintenance. On top of that are variable costs, for example, for chilled water, ranging from $50,000 to $450,000 a month.

Brookfield wants a new deal.

"I think anybody who buys [Revel] is going to have that issue," Burns said.

Source: Philly.com