Discussion in 'Casino Industry & Development' started by SH0CK, Dec 12, 2014.
Inching closer and closer to bankruptcy.
That $224mm payment is actually do on Monday, they are saying Jan 15th because they have a 30-day grace period and its a given they won't make the payment on Monday. One thing to add to that article is it seems to imply that CET just needs to reach an agreement with holders of the bank loans and first-lien notes, that's a big step but it won't be enough. All of the second-lien and other junior lenders can try to block the deal if enough of them aren't on board and it will be up to the court to figure it out. This is a deal that will really go to the 11th hour if it gets done at all.
My take on it is CET is going through the motions - using negotiations not to actually stave off an inevitable bankruptcy, but to establish it made "good faith" efforts to do so. In my opinion, CET is laying the groundwork of a defensible stance against the lawsuits it will face.
I was thinking about this and a light bulb went off.
Loveman is bashed pretty heavily on this board. (I tend to agree with the criticisms.) It finally dawned on me that perhaps, just maybe, that he is a genius and has helped CET make it much farther and longer until bankruptcy, and put CET (or some smaller version of it) in position to survive afterwards. The last decade, especially 5-8 years ago, has been very tough on the casino industry. Maybe Loveman deserves more credit than he currently receives?
Uh no. The problem that caused the debt was the buyout. Loveman engineered the buyout but failed to see the recession coming. After the cash started to flow, they took on more debt and didn't pay off what was already on the books. Loveman managed them to this point. I'll be shocked if their wasn't an investor factor demanding he leave.
What does this all mean in terms of the actual hotel and casinos?
Will we the customers notice any difference?
likely nothing, maybe some hotel names will change for the off strip locations, but I wouldn't imagine much else
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