Bankrupt Casino Makes a Bid for Itself

By: Timothy McFarlin | Published: September 9th, 2010 | Category: Bankruptcy

According to Reuters news, a Nevada judge has recently accepted a $772 million bid for the bankrupt Station Casino, Inc.—from its present owners, Frank and Lorenzo Fertitta.  The company was founded by the owners’ father, Frank Fertitta Jr., in 1976.

Station Casinos, established and based in Las Vegas, filed for bankruptcy just last year and listed $5.7 billion in assets against their $6.5 owed in debt.  With today’s economy and Station not being the first in what is now a long line of bankrupt casinos, it’s no wonder its owners wound up being the largest bidders.

Back in ’76, the company opened the Bingo Palace then later renamed it, Palace Station.  Most known for its catering to Las Vegas’ and Nevada in general’s locals, and not its tourists, Station Casino, Inc. went public, with an IPO, some 17 years later.  In December, four years ago, and thirty years after Station Casinos’ inception, the Brothers Fertitta offered to buy every existing share—at $82 a share.  Their goal, along with Colony Capital, was to make the company go private.

Scott Nielson, Station’s Executive Vice President said, the large bid will cover all wholly-owned properties, any and all tribal gaming partnerships as well as land owned to be later used for developing.  Boyd Gaming Corporation was interested in bidding, but bailed on the idea nearly a week ago and accused the bidding process, on a whole, of favoring insiders.

After not being able to afford the interest on a debt from three years ago, the company filed for bankruptcy.  As of now, it appears the company’s remaining assets are going to go through its own individualized restructuring.

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