Sunday, April 20th12.2°C
21104
20447

Atlantic Club casino in AC closing Jan. 13 after sale to Caesars and Tropicana parent firms

ATLANTIC CITY, N.J. - The Atlantic Club Casino Hotel in Atlantic City says it will close on Jan. 13, reducing the number of casinos in the struggling gambling resort to 11.

It will be the first Atlantic City casino to close since the Sands shut down in 2006 to make way for a new casino project that never got built.

Two companies with casinos in Atlantic City, Tropicana Entertainment and Caesars Entertainment, will pay a combined $23.4 million for the business.

According to bankruptcy filings made Friday afternoon, Tropicana will take the slot machines and table games for $8.4 million, while Caesars will get the property and its more than 800 hotel rooms for $15 million.

A judge must approve the buyers at a hearing Monday.

"First and foremost I would like to express my profound admiration and respect for the employees of this company," said Michael Frawley, chief operating officer of the Atlantic Club. "The events of the last few months have evoked an array of emotions, and through it all, the employees of the Atlantic Club have remained consummate professionals. It is because of these outstanding individuals that we were able to build considerable momentum over the last year. Unfortunately our pace was unsustainable in the extremely challenging Atlantic City gaming market."

He said the casino will operate normally until the Jan. 13 closing date. There were 1,659 employees at the casino-hotel as of Nov. 13.

A Caesars spokesman could not immediately say what the company's plans for the property are. It is to meet with New Jersey gambling regulators within three days to determine what approvals will be necessary in order to end gambling on the premises. The state Division of Gaming Enforcement declined to comment until after Monday's bankruptcy court hearing.

The court filings seem to indicate that Caesars may utilize the hotel portion of the property as a non-casino hotel. It already owns four casinos in Atlantic City — Caesars, Harrah's, Bally's and the Showboat — and hotel rooms for gamblers are at a premium on weekends.

Tony Rodio, president of the Tropicana Casino and Resort, declined comment Friday.

Word of the shutdown came on the fourth day of a bankruptcy court auction.

The Atlantic Club thus became the first Atlantic City casino to fall victim to the insidious downward spiral the resort has found itself in since the advent of casinos in neighbouring Pennsylvania that began in late 2006.

Atlantic City's casino revenues reached a high of $5.2 billion that year, and will likely fall below $3 billion this year.

Analysts have long said Atlantic City has more casinos than the now-diminished market can bear.

Another struggling casino, Revel Casino Hotel, could be headed for a second bankruptcy filing, or could be sold to new owners soon.

Half of the 12 casinos currently operating in Atlantic City have filed for bankruptcy in the last six years.

The Atlantic Club was formerly known as The Atlantic City Hilton, and before that, as the original Golden Nugget in Atlantic City, not to be confused with the former Trump Marina casino that now carries the Golden Nugget name at the opposite end of town.

It struggled to compete against newer, bigger casinos here and in Pennsylvania. For the past two years, it turned its focus to low-rollers and local residents, offering cut-rate prices to attract those unable or unwilling to afford the pricier casinos.

That effort improved the casino's financial picture, but not quickly enough. It filed for Chapter 11 protection in November.

Its owners, Colony Capital LLC, the Los Angeles hedge fund, paid more than a half-billion dollars for it in 2005.

It searched in vain for a purchaser for the past three years, before inking a deal to sell itself to the PokerStars website for $15 million. But that deal fell apart within months due to concerns over whether the websites' management could qualify for a casino license in New Jersey due to an unresolved indictment against the company's founder.

PokerStars then aligned itself with Resorts Casino Hotel — which itself narrowly escaped having to close down in 2010 — to offer Internet gambling in New Jersey. But those legal troubles led to PokerStars being suspended from applying for a license in New Jersey for two years.

___

Wayne Parry can be reached at http://twitter.com/WayneParryAC

The Canadian Press


Read more Business News

20260


Recent Trending




Today's Market
S&P TSX14500.39+53.87
S&P CDNX998.770.80
DJIA0.000.00
Nasdaq4095.516+9.291
S&P 5001864.85+2.54
CDN Dollar0.9073+0.0002
Gold1286.00-7.40
Oil104.16-0.14
Lumber329.70-2.70
Natural Gas4.738-0.003

 
Okanagan Companies
Pacific Safety0.115+0.01
Knighthawk0.01-0.005
QHR Technologies Inc1.29+0.07
Cantex0.055+0.01
Anavex Life Sciences0.3750.00
Metalex Ventures0.08+0.005
Russel Metals30.66+0.11
Copper Mountain Mining2.35-0.07
Colorado Resources0.255-0.01
ReliaBrand Inc0.12-0.01
Sunrise Resources Ltd0.025-0.005
Mission Ready Services0.25+0.02

 



17772

FEATURED Property
189998411404 Tassie Drive
4 bedrooms 3 baths
$549,900
more details
image2image2image2
Click here to feature your property
Please wait... loading


Learning to flirt with the edge

With all of the adventure activities I have done and still do, I wonder sometimes if the edge still exists. The systematic approach to learning a new adventure or extreme activity combined with the r...


Time spent prospecting

How much time should you put into prospecting? The question is a bit of a puzzle. Ideally, there would be a reference book that lists, by industry, how much time you should invest in prospecting acti...


Valuation fears grip markets

The Big Picture Valuation fears grip markets Growing concerns about the level of stock market valuations sparked a risk-off trade in global markets this week. Investors are worried that many companies...

_



21604

21368


Member of BC Press Council


21188