Las Vegas’ Riviera Hotel & Casino owner files for bankruptcy

July 13 (BestGrowthStock) – Riviera Holdings Corp (RVHL.PK: ), owner
of the Riviera Hotel & Casino on the Las Vegas Strip, has filed
for bankruptcy protection under a pre-negotiated deal which
will transfer ownership of the company to senior secured
lenders.

The proposed reorganization plan has the support of a
majority of senior secured lenders, who hold claims under the
company’s $228 million credit agreement, the company said in a
statement late Monday.

In court papers, Riviera said like many casinos in Las
Vegas, it had been deeply affected by the slowdown in the U.S.
economy and was facing increasing isolation given the recent
changes along the north end of the Strip.

Riviera said during the recent economic boom, many
properties on the north Strip were sold or torn down to make
way for new high-end resorts.

However, as the economy rapidly declined, most of those
anticipated new projects either halted construction or failed
to start altogether, it said.

“The effects of such nearby vacant lots and uncompleted
projects have been considerable. Although Riviera Las Vegas has
fewer neighboring competitors, there are also fewer reasons for
customers to venture to the north end of the Strip,” Riviera
said.

In its Chapter 11 petition, the company listed both assets
and liabilities in the $100 million to $500 million range.

The company, also owns and operates a casino in Colorado,
said any recovery for its current shareholders was highly
unlikely.

“There will be no effect on our employees, vendors, and
most importantly, our customers,” the company’s general counsel
Tullio Marchionne said.

The case is In re: Riviera Holdings Corp, U.S. Bankruptcy
Court, District of Nevada (Las Vegas), No: 10-22910.
(Reporting by Santosh Nadgir in Bangalore; Editing by
Gopakumar Warrier)

Las Vegas’ Riviera Hotel & Casino owner files for bankruptcy