(Photo: REUTERS/Tim Shaffer)
A new casino bankruptcy has been announced, striking more concern among Atlantic City investors who had hoped Revel Casino would be able to help turn around the fortunes of the area.
Revel Casino announced on Tuesday that it will file for Chapter 11 bankruptcy protection in March. The announcement has shocked some, as the casino was touted at one point as the glimmering light to help the struggling businesses in the area, and the casino has also been open for less than a year.
The bankruptcy is likely to go ahead in late March, and will look to clear approximately two-thirds of the casino's $1.5 billion debt by converting around $1 billion into equity for lenders, according to The Associated Press.
Kevin DeSanctis, Revel's CEO, has claimed that the restructuring will provide a new way forward for the casino, and give the resort more flexibility to operate. he said, "Today's announcement is a positive step for Revel. 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," according to AP.
The casino management was quick to highlight that at this point all existing management will remain in place, and they have not planned to make any redundancies. All employees and vendors at the company can expect to be paid as normal, the casino has reassured.
It has been reported that over the second and third quarters of 2012 the casino reported gross operating losses of $35 million and $37 million respectively.
Michael Drewniak, who is the press secretary to Gov. Chris Christie's office, has said, "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.
"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."