There’s More “Good News” Than “Bad” Regarding Revel’s Bankruptcy
There's been a lot of media coverage about Revel and their upcoming pre-packaged Chapter 11 Bankruptcy filing. Most of the coverage has been hyper negative.
There is another very legitimate way to look at what's about to unfold in late March, 2013.
Revel presently has a massive amount of debt to be served. It measures between $ 1.3 to $ 1.5 billion dollars.
Even if Revel was performing at peak (present) market efficiencies, they simply can't generate enough cash required to pay the monthly debt service.
Hence, they have been deficit spending for their entire existence to date.
With creditors willing to stay on board with Revel and accept equity in the company in exchange for forgiving debt, Revel's debt service will soon be reduced to $ 250 million dollars.
This will get them back in the "game." A fair analogy would be, say that you have a $ 5,000 per-month mortgage. Suddenly, it's reduced to $ 500 per-month. It would breathe new life into you and the same will hold true for Revel.
It is extremely important to note that Revel has pledged to pay all vendors and they've confirmed that no employee layoffs are planned.
New Jersey Assemblyman John Amodeo appeared this morning on "Hurley in the Morning," on WPG Talk Radio 1450 and confirmed that he spoke directly to Revel Chairman and Chief Executive Officer Kevin DeSanctis last night in the 8:00 p.m. hour. This was within minutes of the news about the pre-approved bankruptcy package being announced.
DeSanctis confirmed all the key points mentioned above.
Despite the fact that Revel has had significant marketing and revenue problems, DeSanctis is an outstanding casino Chief Executive Officer, with a proven track record of delivering results.
DeSanctis has had successful stints with Donald Trump, Penn National Gaming and Shreveport Capital Corporation (Hollywood Casino Shreveport), before Revel.
To date, Revel is his first under performing assignment. Well placed sources have confirmed that DeSanctis is in the process of making major changes to right the casino revenue ship at Revel.
So, the next time you hear what "bad" news the Revel Chapter 11 filing is: The truth is that there is a legitimate at play. Now you have certain facts that have not been previously reported any where else.
*In addition to being one of South Jersey's foremost talk radio hosts, Harry Hurley spent 11 years as a casino executive in Atlantic City.