Judge terminates deal between Revel and investor Straub
No deal: Glenn Straub's agreement to buy Revel was formally terminated Thursday by U.S. Bankruptcy Judge Gloria M. Burns. The ruling puts Revel, which filed for its second bankruptcy in June of last year, and then closed in September, back to square one in its efforts to find a buyer.
No deal: Glenn Straub's agreement to buy Revel was formally terminated Thursday by U.S. Bankruptcy Judge Gloria M. Burns.
The ruling puts Revel, which filed for its second bankruptcy in June of last year, and then closed in September, back to square one in its efforts to find a buyer.
It is unclear where Revel's attorneys and other professionals will turn. The Straub deal is the second to fall apart. Canadian-based Brookfield Asset Management Inc. walked away from its $110 million offer in November, abandoning its $11 million deposit.
Revel opened in April 2012 and filed for its first bankruptcy less than a year later after its novel strategies - no smoking, no dining buffet, no high-end slots area - fell flat with too many gamblers. The property also had ardent fans, who were wowed by spectacular views from every room.
It has been for sale since November 2013.
The first attempt, last August, to auction the company during the current bankruptcy failed to generate bids acceptable to Revel's main lender, Wells Fargo Bank.
Some have speculated that Hard Rock International, a company owned by the Seminole Indians, could buy it, despite rejecting a chance to do so early last year. A Revel attorney said in a recent court hearing that Hard Rock's interest in Revel was limited to operating a casino there for a new owner, not in owning the property itself.
Richard Meruelo, who is part of a family that has made at least two attempts to acquire Atlantic City casinos, attended a Revel bankruptcy hearing in September and expressed interest in buying the property. It is unclear if he is still interested.
Straub, who is based in Wellington, Fla., where he owns the Palm Beach Polo & Country Club, said Thursday after the ruling that he would not participate in another round of bidding.
"We're not going to buy it again. We have to move on," he said.
Burns' decision, following last-ditch negotiations this week that sought to salvage the deal, also set the stage for another round of litigation in the case, which Burns called "long and tortured."
In addition to allowing Revel to end the agreement with Straub - which had required the deal to be completed by Feb. 9 - Burns said Revel could keep Straub's $10 million deposit, as called for in the purchase agreement.
But she ordered Revel to keep the money in a segregated account and not spend the money unless she issued an order allowing Revel to do so.
Straub's attorney, Stuart J. Moskovitz, said Straub would appeal the decision allowing Revel to keep the deposit. Moskovitz wanted the deposit kept in escrow, far from the reach of Revel's lawyers and other advisers, who were paid $14 million through December, according to the latest monthly operating report.
Revel's lead bankruptcy attorney, John K. Cunningham, of White & Case L.L.P., told Burns on Thursday that Revel wanted to spend the $10 million and would soon ask for permission to do so.