Florida investor Glenn Straub wants an extension of his
deadline to buy the bankrupt Revel Casino Hotel in Atlantic City, according to
a motion filed Sunday in U.S. Bankruptcy Court in Camden.
U.S. Bankruptcy Judge Gloria M. Burns scheduled a hearing
Thursday to consider the motion. That effectively extended the deadline in
Straub's agreement by three days.
The request for more time beyond that could face
opposition from Revel's lender Wells Fargo, which has lent Revel $70 million to
pay for its bankruptcy and has repeatedly expressed concern that its bridge
loan to Revel will turn into a pier.
Straub's agreement to pay $95.4 million for Revel was
supposed to expire Monday, but federal judges have temporarily blocked certain
provisions of the sale in response to appeals by businesses that had leases to
operate in the $2.4 billion Revel.
Those roadblocks involve just one aspect of Straub's
purchase agreement: his desire to buy the property free of all obligations to
the night clubs, restaurants and other businesses that have unexpired leases in
the casino.
Revel's attorneys were required to make a
"commercially reasonable effort" to sell the property to Straub on
those terms, but the tenants have fought back and scored court victories that
have made that temporarily impossible.
An order Friday by the U.S. Court of Appeals in
Philadelphia said explicitly that the sale can be completed, but not without
giving nightclub operator IDEA Boardwalk L.L.C. a chance to protect its
property rights in an appeal.
At a 3 p.m. hearing in U.S. District Court in Camden,
Judge Jerome B. Simandle will consider whether to allow utility provider ACR
Energy Partners L.L.C. and a group of restaurants and retailers to piggyback on
the appeals court ruling.
A delay until the end of this month to work through the
court cases, as Straub suggested, would add to the costs of the bankruptcy,
which have already reached $16 million in fees for lawyers, bankers and other
professionals.
In negotiating with Straub, Revel and Wells Fargo have to
weigh the extra cost of a delay against the possibility is that Straub could
abandon the deal. Even if he left his $10 million behind, the company would
likely need more money from Wells Fargo to keep going.
Sunday's motion for an extension - made on behalf of
Straub's company Polo North Country Club Inc. - raised new issues beyond
objections to having to deal with tenants after he buys the property.
One had to do with Polo North having to obtain a gaming
license before the sale can be completed.
"Closing under the Polo North [asset purchase
agreement] cannot take place until such time as Polo North obtains its gaming
approvals," the filing said. Polo North's application is pending, it said.
This is the first time anyone has suggested that Straub's
agreement to purchase Revel was contingent on his obtaining a gaming license.
The New Jersey Division of Gaming Enforcement, which investigates applicants,
or the New Jersey Division of Gaming Enforcement, which issues licenses, did
not immediately confirm that Polo North's license was pending.
The filing Sunday also said that there are problems with
Revel's title "that must be resolved before the debtor can transfer clear
and marketable title to Polo North.
Source: Philly.com
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