$2.4 billion Revel worth only $246-$331 millionMarch 25, 2013 7:11 PM by Ray Poirier
How quickly billions of dollars can disappear because of a bad investment made in a bad time. Certainly the gaming industry has seen its share since the beginning of the 2007 recession. Just on the Las Vegas Strip, investors can see the remains of the Echelon, the Fontainblue, or the empty space that was once the New Frontier.
Atlantic City has seen several of its Boardwalk casinos and real estate parcels being sold for a fraction of their original costs. And now it is looking at the biggest failure of all, the Revel.
The city’s newest casino, built at a cost of some $2.4 billion, is filing for bankruptcy less than a year since its troubled opening. Unable to generate enough cash flow to meet its obligations, the property reportedly has filed a 400-page disclosure statement that it sent to creditors as part of the prepackaged bankruptcy plan.
According to a story in The Press of Atlantic City, the filing places the value of the property at just a fraction of its original cost.
The bankruptcy plan lists its debt at about $1.5 billion and calls for converting about $1 billion of that into equity, leaving it with $272 million in debt.
The debtors believe the plan, which contemplates a significant deleveraging, is in the “best interest of all creditors,” the disclosure form said. “Any other alternative does not in any way realize or recognize the value inherent under the plan.”
So how much is Revel worth today?
The company estimates that if it were sold within the next six months it would fetch between $246 million and $331 million.
Ray Poirier is the longtime executive editor at GamingToday.
Contact Ray at RayPoirier@GamingToday.com.
Interested in coming to Las Vegas to be part of the matchup to end all matchups that Floyd Mayweather and Manny Pacquiao are selling at the MGM Grand Garden Arena? It’s gonna cost you.
A New Jersey appeals court has rejected a bid by the world’s largest online poker website to regain the right to buy an Atlantic City casino. The court sided with the Atlantic Club in its battle with PokerStars.
The Iowa Supreme Court ruled that a Waterloo casino does not have to pay Pauline McKee the $41 million she thought she won in 2011 while playing a penny slot machine.
South Korea continues to look very good to potential casino operators who are searching the Pacific Rim for possible casino development locations as the Macau numbers continue their slide.
Legalized video gaming in Illinois has taken its toll on the riverfront casino industry, something that was not expected to happen when the video gaming terminals were first installed in 2009.