Black Gaming plans to file for Chapter 11 bankruptcy
Black Gaming LLC, the Las Vegas-based owner and operator of three casinos in Mesquite, said Wednesday that it will file for Chapter 11 bankruptcy, which allows it to continue operations. The company said it reached an agreement with some of its creditors in advance of the bankruptcy petition.
Robert R. “Randy” Black Sr., South Point owner Michael Gaughan and Anthony Toti are investors in the reorganized company.
Black will remain chief executive officer. Either he, parties designated by Gaughan or others will contribute $17 million in cash for 94 percent of the equity in the reorganized company. Black Gaming owns the CasaBlanca, Virgin River and Oasis resorts in Mesquite. In a statement, CEO Black said the company is generating cash flow but has too much debt.
General Growth gets creditors’ approval to restructure loans
General Growth Properties Inc., the second-largest U.S. mall owner, has won approval from creditors and a federal court to restructure loans totaling $11.6 billion, according to a lawyer.
The company on Tuesday won confirmation from U.S. Bankruptcy Judge Allan Gropper in Manhattan of its plan to extend the maturities of seven loans totaling at least $1.3 billion after creditors agreed to the terms.
That amount was in addition to $10.25 billion in debt that Gropper said on Dec. 15 that Chicago-based General Growth could reorganize in its Chapter 11 bankruptcy case, bringing the total to $11.6 billion, said Anup Sathy, a Kirkland & Ellis LLP lawyer representing General Growth.
Tuesday’s ruling leaves five loans covering 24 properties, including malls in Las Vegas and Louisiana, which the company wants lenders to agree to alter, Sathy said.
Gropper has scheduled another hearing for Tuesday. General Growth is continuing to negotiate with lenders and loan servicers to add more properties into the restructuring plan, Sathy said.
In Las Vegas, General Growth owns the Meadows, Boulevard and Fashion Show malls, the Shoppes at Palazzo and the Grand Canal Shoppes at The Venetian.
Citigroup, Wells Fargo repay government relief money
Citigroup Inc. and Wells Fargo & Co. said Wednesday that they repaid $45 billion the giant banks got from the Troubled Asset Relief Program in the midst of the financial crisis last year, freeing them from government restrictions on compensation.
Citi said it repurchased $20 billion of TARP trust preferred securities it had sold to the Treasury Department under TARP’s Capital Purchase Program.
Citi also ended a large loss-sharing program with the government, which canceled $1.8 billion of trust preferred securities that were part of the $7.1 billion Citi paid for the extra support.
The Treasury Department continues to own 7.7 billion shares of Citi common stock, worth more than $20 billion. It was planning to sell roughly $5 billion of that earlier this month, but backed off after Citi shares fell under pressure from a huge offering of new stock by the bank.
Exiting TARP means Wells Fargo won’t have to pay $1.25 billion in future annual preferred-stock dividends. However, Treasury continues to hold warrants to purchase approximately 110 million shares of Wells common stock at an exercise price of $34.01 a share.
Personal incomes, spending increase during November
Personal incomes rose in November at the fastest pace in six months, while spending posted a second straight increase. But economists caution that the gains remain too weak to sustain a strong economic recovery.
The Commerce Department said Wednesday that personal incomes rose 0.4 percent in November, helped by a $16.1 billion increase in wages and salaries. It reflected the drop in unemployment that occurred last month.
The rise in incomes helped bolster spending, which rose 0.5 percent in November. Both the income and spending gains were slightly less than economists had expected.
The 0.4 percent rise in incomes followed a 0.3 percent October gain. It was the best showing since a 1.5 percent spurt in May, a month when incomes were boosted by government payments and tax relief from the $787 billion economic stimulus program.
The 0.5 percent rise in consumer spending reflected the surprisingly strong 1.3 percent jump in retail sales that occurred during November — a boost that came from shoppers crowding malls seeking deep discounts over the Thanksgiving weekend.
Ford moves closer to selling Volvo to China’s Geely Group
Ford Motor Co. said it is moving closer to selling its Swedish Volvo brand, even though the U.S. automaker is in far better financial shape than it was when it put the brand up for sale last year.
The Dearborn, Mich., automaker said Wednesday that it expects to finalize the sale of Volvo to China’s Geely Group early next year if financing and government approvals fall into place.
Ford did not reveal the amount of Geely’s offer. Auto analyst Matts Carlson estimated the price tag for Volvo at between $2 billion and $2.3 billion.
Ford officially put Volvo on the market in December 2008.
Buffett company continues to reduce stake in Moody’s
Billionaire Warren Buffett’s company is continuing to reduce its stake in credit ratings firm Moody’s Corp., but Berkshire Hathaway Inc. still controls about 13 percent of Moody’s stock.
Berkshire sold 87,992 Moody’s shares on Friday. The Omaha-based company revealed the latest sale in documents filed Tuesday with the Securities and Exchange Commission.
Over the past nine months, Berkshire has significantly reduced its Moody’s holdings. Berkshire held 48 million shares in March and reduced that stake to 31.8 million as of last week.
JPMorgan chief will testify as part of collapse investigation
Jamie Dimon, chief executive officer of JPMorgan Chase & Co., will be among the first witnesses to testify before a commission investigating last year’s financial collapse.
Goldman Sachs Group Inc. Chairman and CEO Lloyd Blankfein and Morgan Stanley Chairman and CEO John Mack also have agreed to testify at next month’s inaugural hearing of the Financial Crisis Inquiry Commission, Chairman Phil Angelides said.
Bank of America Corp.’s new CEO, Brian Moynihan, has been invited and is expected to appear as well, Angelides said.
“We have requested the appearance of key leaders who have been involved in the financial crisis,” Angelides said in a telephone interview. “There’s no question that these institutions were at the center of this storm, not to make any prejudgments about their role in it.”
Commission Vice Chairman Bill Thomas, who also was on the phone call, said the witnesses will be followed by testimony from academics and others over the course of the two-day hearing.