Revel AC Inc., the bankrupt Atlantic City, New Jersey, casino operator, postponed an asset auction indefinitely, the day after announcing it will close its doors by next month.
The casino company said in court filings today that it’s still reviewing bids and working on a “value-maximizing” sale. The company said yesterday that the resort will be shuttered no later than Sept. 10 because none of the offers met certain requirements.
Revel delayed the auction, set to take place tomorrow after already being pushed back one week, to a date to be determined so it can work with potential buyers toward “the goal of naming a successful bidder,” according to court documents.
The culprit behind Revel’s bankruptcy and the demise of other Atlantic City gambling mainstays is the growing competition from Pennsylvania, Maryland and New York.
Revel’s casino revenue plunged about 36 percent in July compared with the previous year, according to a report issued today by the New Jersey Division of Gaming Enforcement. Casino revenue in the New Jersey gambling mecca fell more than 40 percent to about $2.8 billion in 2013 from a peak of more than $5 billion in 2006.
Atlantic City’s first new casino since 2003, Revel opened in April 2012 at a cost of $2.4 billion, only to shut down for five days a few months later because of Hurricane Sandy. It filed a first bankruptcy in March 2013 before seeking creditor protection again in June.
Under the previous restructuring, Revel cut its debt by about $1.2 billion, handing ownership of the company to creditors. Chatham Asset Management, identified in court filings as the casino’s largest equity owner, has exited the investment, according to a spokesman.
Revel’s struggles illustrate the larger woes facing Atlantic City, which has already seen the Atlantic Club close and is slated to lose two more casinos in addition to Revel’s by the end of September.
Caesars Entertainment Corp. plans to shutter the Showboat on Aug. 31 sending 2,133 workers to the unemployment lines, and the Trump Plaza Hotel & Casino said it plans to end operations on Sept. 16, terminating about 1,009 jobs.
As Revel follows suit, more than 6,200 total jobs in the hotel and casino business are set to vanish from the seaside resort. Atlantic City’s unemployment rate might jump to 14 percent from 9.5 percent in June, more than double the national average, according to Bloomberg News calculations.
Revel, which employs about 3,140 people, told workers in June, when it filed its second bankruptcy, that it may be forced to close for good if it fails to attract a buyer.
The 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 its website. The resort has 1,399 rooms, indoor and outdoor pools, as well as 13 restaurants and night clubs.
The company listed as much as $1 billion each in assets and debt in its Chapter 11 filing June 19 in U.S. Bankruptcy Court in Camden. Five affiliates also sought court protection.
The case is In re Revel AC Inc., 14-bk-22654, U.S. Bankruptcy Court, District of New Jersey (Camden). The previous case is In re Revel AC Inc., 13-bk-16253. U.S. Bankruptcy Court, District of New Jersey (Camden).