In New Hampshire’s neighboring state of New Jersey, the Atlantic Club Casino is on the verge of bankruptcy. This casino, located on the boardwalk in Atlantic City, opened in 1980. It was once called the Golden Nugget and then the Atlantic Hilton. Owned by Colony Capital LLC, it is one of the smallest casinos in Atlantic City.
The economy and larger competitive casinos have caused the Atlantic Club to lower its standards and downgrade to a much less sophisticated business, now serving a lower-end clientele. Last year, the Rational Group was considered as a possible buyer for the casino, but that deal fell through in the early part of this year. Rational Group currently owns an online-gambling business, known as PokerStars.
According to sources, the casino will be put up for auction after filing a Chapter 11 bankruptcy petition. The company has already secured around $15 million in funding, which could be used, per bankruptcy law, as a floor price for beginning the auction. The $15 million came from a hedge fund, according to recent reports.
Chapter 11 could be a good option for a business of this type. In a Chapter 11 bankruptcy, the debtor has an opportunity to reorganize their debts without having to liquidate all of their assets. They must come up with a plan that is approved by the bankruptcy court. A trustee will work with the debtors to modify the terms of the loans. Creditors will often reduce the amount owed on the loans or reduce the interest owed.
Chapter 11 bankruptcies are not limited to businesses, but can also be used by individuals who do not meet Chapter 7 or Chapter 13 bankruptcy criteria. However, they can be quite complex and require an experienced attorney. New Hampshire attorneys can explain options available to those who are considering bankruptcy for either a business or their own personal financial situation.
Online.wsj.com, “Atlantic Club Casino Hotel Prepares Bankruptcy Filing” Patrick Fitzgerald and Peg Brickley, Nov. 06, 2013