Straub holds Revel hostage; Caesars cutbacks begin

Revel continues to be a bone of contention. Utility supplier ACR Energy Partners is leading a group of creditors attempting to block the sale of Revel to Glenn Straub. The latter, they assert, could simply walk away from all contracts, claims, liens and leases on the property. In turn, Straub attorney Stuart Moskowitz argues that, for $10 million, his client could just scuttle the deal. “My client would say, ‘I’d rather lose $10 million now than bleed $5, $6, $7 million a month for the next three years’,” he explained. Revel nightclub tenant Idea Boardwalk counters that it will lose its whole $16 million investment if Straub’s purchase is consummated.

ACR’s Craig Martin contends that, with Revel in hand, Straub would hold the edge in any negotiations with creditors and their tenancy would be at his mercy. Straub, in turn, is playing his eternal trump card, threatening to walk away and leave Revel ownerless. To add steel to his threat, he asserted that this would inflict further economic harm on the Boardwalk. “It is common knowledge, of which the Court can surely take judicial notice, that Atlantic City is in trouble … Anything that delays the opening of this property to positive commercial utilization does serious harm to the public, to the city itself, to the people yearning to go back to work, to the small businesses who are on the verge of bankruptcy themselves,” Moskowitz declared.

* Carl Icahn, meanwhile, prepares to disclose his plan for taking over what’s left of Trump Entertainment Resorts. On the same day (Jan. 28) that his $200 million loan to TER comes up for court approval. Unsecured Trump creditors are considerably less than thrilled by what they’ve seen of the Icahn plan. They’d have to settle for a million in cash and the right to sue for half of one percent of $232 million in unsecured debt. Icahn, meanwhile, would roll $286 million of debt into ownership. It’s definitely a wily scheme to become one of the dominant casino owners in town.

That’s presuming Icahn takes a less combative stance with Unite-Here Local 54, which he continues to antagonize. Icahn continues to characterize the union’s preferred terms (to which he briefly agreed) as “suicidal” and “suffocating.” That’s hardly the path to achieving his stated goal of “labor peace” — which seems to consist of the union giving him everything he wants. Legislators have taken notice. “The problem is that right now the Taj Mahal employees don’t have a contract. Icahn is actually holding up property-tax reform for the City of Atlantic City,” Assemblyman Vincent Mazzeo (D) said. Icahn claims he doesn’t need state help to stay open but that’s a big 180 from his previous stance on the subject.

* The era of the Caesars Entertainment bankruptcy has begun and the cutbacks are being felt where you most suspected they would fall: customer service. According to our research department, Flavors at Harrah’s Las Vegas only will serve lunch on weekends while the Flamingo has cut its buffet to a brunch-only amenity. The first belt to be tightened at Caesars will be yours.