The final piece of the Station Casinos bankruptcy reorganization puzzle fell into place late Wednesday when company representatives reached agreement with a second group of unsecured creditors who had opposed the plan.
The agreement document, filed with the U.S. Bankruptcy Court in Reno, means there will be no formal opposition to the company's plan of reorganization, which will reduce the company's debt by $4 billion and leave the Fertitta family in charge of the current 18-casino operation, albeit with a smaller ownership stake.
"If the stipulation is approved, the debtors will have achieved a fully consensual plan, with not a single objection to confirmation of the plan filed by any holders of claims or equity interests, or any other party in interest," attorneys for Station Casinos wrote in the filing.
A hearing is planned for Aug. 27 in Reno where a federal bankruptcy judge is expected to confirm the company's two-pronged reorganization plan.
The first leg of the reorganization establishes a new holding company owned by real estate investor Colony Capital, secured lenders Deutsche Bank and JP Morgan, and Fertitta Gaming, which was formed by Station Casinos founders Frank Fertitta III and his brother Lorenzo.
The new company would take over Red Rock Resort, Palace Station, Sunset Station, Boulder Station, and the Wild Wild West and its adjoining 110 acres. Those casinos provide more than half of Station Casinos' overall revenues.
The Fertittas will put up $85 million for their share of this company.
On Aug. 6, Fertitta Gaming won a bankruptcy-supervised auction to acquire 11 casinos, land holdings and American Indian gaming contracts for $772 million. Fertitta Gaming was the only qualified bidder.
Once the reorganization is confirmed, Nevada gaming regulators and the National Indian Gaming Commission will have to confirm the new corporate ownership structure.
Fertitta Gaming will operate both sides of the reorganized company and the Station Casinos name will remain in place.
Station Casinos filed Chapter 11 in Reno last year, owing some $6 billion. The company is expected to emerge from bankruptcy with a more manageable debt of $2 billion.
The last remaining group of unsecured creditors were owed $244 million.
Station Casinos had previously reached an agreement with unsecured bondholders to invest up to $100 million for an up to 15 percent stake in the reorganized company. The bondholders, owed some $2.8 billion, will see the debt canceled.
Contact reporter Howard Stutz at email@example.com or 702-477-3871.