Revel, Atlantic City’s last hope and $2.4 billion casino has hopped on the casino bankruptcy bandwagon less than one year after opening its doors. According to a Feb. 19 Associated Press report, Revel casino said it will file for Chapter 11 bankruptcy protection in March.
The voluntary, prepackaged bankruptcy slated for late March will reportedly wipe away about two-thirds of its $1.5 billion in debt by converting more than $1 billion of it into equity for lenders. Kevin DeSanctis, Revel's CEO, said the restructuring offers the casino more flexibiity. “Today's announcement is a positive step for Revel,” DeSanctis said. “The agreement we have reached with our lenders will ensure that the hundreds of thousands of guests who visit Revel every year will continue to enjoy a signature Revel experience in our world-class facility.”
The Associated Press reports that the casino’s existing management will remain, with no planned layoffs. The restructuring will not affect any payments to employees and vendors and should be completed by early summer, the company announced.
Michael Drewniak, Gov. Chris Christie's press secretary, showed support for Revel’s restructuring plan.
“We are committed to the resurgence of Atlantic City, the tourism district, and the many efforts currently under way to bring world-class attractions and entertainment to the city,” he said. “A rejuvenated Revel will remain an integral part of that landscape, as it continues full operations as a premiere hotel, gaming and top-flight entertainment hub for the city, in addition to employing more than 2,000 people. Most importantly, none of those things that make Revel among Atlantic City's highest-profile attractions will change, as Revel uses this new financial flexibility and the continued backing of its investors to grow the business and be part of Atlantic City's expansion.”
Revel is just one of several recent casino bankruptcy filings. It follows Trump Entertainment and Tropicana Casino and Resort. “As part of the restructuring, some of Revel's lenders will provide approximately $250 million in debtor-in-possession financing, about $45 million of which constitutes new money commitments and approximately $205 million of which is pre-petition debt,” according to the Associated Press.
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