News for the Hospitality Executive
Carl Icahn Completes Restructuring Tropicana Entertainment
Eliminates $2.5 billion Indebtedness, Renews Gaming Licenses in
Five States, Successfully Emerges From Bankruptcy
NEW YORK, March 8, 2010 - Carl C. Icahn announced that effective today Tropicana Entertainment Inc. has successfully emerged from the Chapter 11 reorganization process as an invigorated new company reunited with its signature property in Atlantic City and well-positioned to succeed in today's challenging business environment. The Company operates nine properties in five states ranging from Nevada to New Jersey, which comprise approximately 6,000 hotel rooms and over 450,000 square feet of gaming space. Affiliates of Mr. Icahn own approximately 47% of the Company and are also lenders under the Company's new exit facility.
As a result of the restructuring, Tropicana eliminated approximately $2.5 billion of pre-existing indebtedness, renewed its gaming licenses in the five states where it operates, restored relationships with its customers, regulators and employees, installed experienced management at each of its properties, and secured $150 million in exit financing to repay its DIP facility and invest in its facilities.
Tropicana Entertainment is the first major company in the gaming industry to successfully complete a Chapter 11 reorganization necessitated in part by the combined effects of collapsed commercial credit markets and associated declines in the U.S. consumer economy.
"The company has undergone a complete transformation," said Tropicana CEO and President, Scott C. Butera, who joined the company in 2008 to lead the restructuring. "We are very pleased that we have been able to turn the Company around in the wake of the country's deep financial crisis. We have also secured an ownership group that has a long proven track record of success in the gaming industry. By constantly adjusting to market conditions, we have built the foundations of our company in a way that positions us to achieve profitable long term growth."
As part of the restructuring Butera attracted an entirely new management team and established a governance structure with an experienced board of directors. The new group, with extensive experience in the entertainment and gaming industry, ultimately repaired the company's relationships with regulators as it gained operating authority in critical gaming jurisdictions.
"We are very excited to be reunited with the Tropicana Atlantic City Casino & Resort. It is a magnificent property and I commend the management and employees for their success during a very challenging time."
"With a manageable level of debt and a more efficient operating style, we are ready to start making investments in sustainable revenue growth," Butera said. "They will be modest and targeted at first, but we expect over time to deploy our capital in ways that will generate significant returns to our investors."
As the company worked its way through the reorganization process, it took aggressive steps at the operating level. All of the company's properties are managed by executives who emphasize efficiency and return on investment. The company is also enhancing customer service at each property and is in the process of upgrading its marketing and promotion programs to employ a more targeted, data-driven approach that relies heavily on proven database marketing concepts as a way to engage and retain customers.
"That we have come this far is testimony to the dedication of the entire
Tropicana team," Butera said. "Our new owners; our advisors, creditors
and vendors; our management group; and, most important, our team members,
all deserve tremendous credit for the work they have done to help put us
on the right track for the future."
About Tropicana Entertainment
Carl C. Icahn
|Also See:||Tropicana Taps Former Reno Hilton President, Tim Maland as New General Manager at Tahoe s MontBlue Resort and Casino / November 2009|