Lost in the announcement last week that Revel will be filing for bankruptcy in March is that they plan on selling the casino to a company already operating a casino in Atlantic City.
In fact, the creditors are already in early-stage talks with Apollo Management’s Caesar’s Entertainment, Marc Lasry’s Avenue Capital and Carl Icahn about selling control of Revel, the source said. The plan is to sell Revel to an existing Atlantic City casino owner within six months who can offer their customers points for also going to Revel.
I’m surprised I haven’t read any speculation about who will buy Revel and I’m surprised that the first place I read about this was the New York Post, one of the worst news papers in the world.
Carl Icahn owns Tropicana, which has no affiliation with Tropicana Las Vegas. This would give the company bookend casinos on the Atlantic City boardwalk. Tropicana has put a large emphasis on nightclubs and restaurants which is similar to how Revel wanted market themselves. There is definitely cross marketing that can be done here but I’m not sure that this partnership brings more gamblers to Revel.
I don’t see Caesars Entertainment buying Revel, outright, because they have so much debt. I’m sure one of their financing companies would consider buying a distressed asset at a deep discount. Maybe there is a good combination here with Apollo buying Revel and Caesars operating it. A Total Rewards connection would certainly bring more gamblers to Revel.
One company not mentioned by the New York Post is Boyd Gaming who own 50% of Borgata. The other 50% of Borgata is owned by MGM Resorts. Boyd Gaming owns casinos all over the country a la Caesars with 10 in Las Vegas. Unfortunately Borgata’s players club isn’t affiliated with Boyd Gaming’s B-Connected card, but I digress. 30% of Boyd Gaming’s revenue comes from owning half of Borgata.
Borgata is seen as the best casino in Atlantic City and I’d probably agree with that. Perhaps Boyd Gaming will look to acquire 100% of the 2nd nicest hotel and casino in Atlantic City if its such a good revenue market for them. If Boyd Gaming owns 100% of Revel it would allow them to bring another national players club to Atlantic City which could breathe some fresh air into the market.
Whoever obtains Revel will be getting a top quality resort that doesn’t need physical renovations at a very deep discount. This is the most exciting thing to happen in Atlantic City since Revel opened. I’m sure that’s pretty sad in its own right.
Photo – flickr - Paul Katcher
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