Revel AC Inc., an Atlantic City, New Jersey, casino owner trying to exit bankruptcy next month, asked a judge to disband an official committee of unsecured creditors, calling its potential oversight unnecessary.
The committee, known as the OCUC, should be disbanded because it has only one member left after two others resigned, Revel said in court papers filed this morning in U.S. Bankruptcy court in Camden, New Jersey. The company also said it expects a court to confirm its reorganization plan in about three weeks.
“Confirmation is imminent, all creditors voting have accepted the plan, exit financing is arranged and the proposed OCUC consists of only a single member,” Revel said in the filing.
Christopher A. Ward, an attorney for the creditor committee, didn’t immediately return an e-mail seeking comment of Revel’s motion to disband.
Also today, U.S. Bankruptcy Judge Judith H. Wizmur gave the company final approval for its plan to borrow as much as $250 million to help finance the bankruptcy case. About $42 million of the loan will involve new money Revel can use, while $208 million is existing debt.
The loan and a series of routine requests approved by Wizmur last month will allow the company to “continue paying employee wages and benefits, taxes, insurance, and vendors in the ordinary course of business,” the company said in a statement today.
Revel filed for bankruptcy March 25 with a reorganization plan supported by more than three-quarters of claimholders under various credit agreements.
Revel is scheduled to return to bankruptcy court May 13 to ask Wizmur to approve the plan. All creditors entitled to vote cast ballots in its favor, including creditors owed about $1.26 billion in debt, Revel said in court papers.
Unsecured creditors are often represented in Chapter 11 cases by an official committee appointed by the U.S. Trustee, an arm of the Justice Department that oversees corporate bankruptcies. A committee typically investigates the bankrupt company’s financial condition and negotiates on behalf of smaller, lower-ranking creditors. The committee’s lawyers and financial advisers are paid by the bankrupt company.
Revel put together its reorganization plan less than a year after the casino opened in April 2012. Under the plan, creditors will swap debt for equity.
Casinos in Atlantic City have struggled with competition from new gambling venues in Philadelphia about 60 miles (97 kilometers) away and a weak economy. Wizmur also oversaw the bankruptcy of Trump Entertainment Resorts Inc., the Atlantic City casino company named after, and once partly owned by, Donald Trump.
Revel was Atlantic City’s first new casino since 2003, opening at a cost of $2.6 billion before closing for several days starting Oct. 28 because of Hurricane Sandy. Gambling revenue in Atlantic City fell 13 percent in January to $205.6 million, the New Jersey Attorney General’s Office said in a Feb. 11 statement.
The Revel casino and resort, on Atlantic City’s Boardwalk, has about 130,000 square feet of gaming space, with 2,400 slot machines, 130 table games and a poker room, according to the bankruptcy filing. The resort has 1,399 rooms, indoor and outdoor pools, 11 restaurants, two night clubs and a 5,500-seat theater. The resort employs about 5,500 people.
The casino project was the centerpiece of Governor Chris Christie’s efforts to revitalize gambling in the state after six years of decline. Christie, a Republican in his first term, jump-started the project with $261 million in state tax incentives.
The case is In re Revel AC Inc., 13-16253, U.S. Bankruptcy Court, District of New Jersey (Camden).
To contact the reporters on this story: Steven Church in Wilmington, Delaware, at email@example.com