A.C. casino files Chapt. 11 due to lack of Revel-ers

ASSOCIATED PRESS
Posted: February 20, 2013

ATLANTIC CITY - Revel, the casino that many people had hoped would turn around Atlantic City's sagging fortunes, said Tuesday that it will file for Chapter 11 bankruptcy protection in March, less than a year after it opened.

The voluntary, prepackaged bankruptcy envisioned for late March will wipe away about two-thirds of its $1.5 billion debt by converting more than $1 billion of it into equity for lenders.

Kevin DeSanctis, Revel's CEO, said that the restructuring would give the casino resort more flexibility to operate.

Existing management will remain in place, no layoffs are planned, and employees and vendors will be paid as usual, the company said. The restructuring should be completed by early summer, it added.

The $2.4 billion casino never caught on as much as it had expected to, and it remained mired toward the bottom of Atlantic City's 12 casinos in terms of casino revenue. Revel had to line up two rounds of additional financing since August to keep operating.

In January, it posted its second-worst month, winning less than $8 million from gamblers. During the second and third quarters of last year, it reported gross operating losses of $35 million and $37 million.

Revel's workforce is largely nonunion, a fact that earned it the undying enmity of Local 54 of the Unite-HERE union, representing most of the city's casino workers.

Revel opened in April as a potential game-changer, the first new casino built in Atlantic City since the Borgata Hotel Casino & Spa opened in 2003.

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