The $1.3 billion sale of the Stratosphere’s parent company to an affiliate of Goldman Sachs was recommended for approval by the state Gaming Control Board on Wednesday.
Whitehall Street Real Estate Funds is buying American Casino & Entertainment Properties, a gaming subsidiary controlled by billionaire corporate raider Carl Icahn. American Casino is also the parent company of both Arizona Charlie’s casinos and the Aquarius in Laughlin.
Whitehall managing director Stuart Rothenberg told regulators most of the gaming company’s executives and property management will remain in place after the sale’s closure, which is scheduled for next month.
American Casino Chief Executive Officer and President Richard Brown, who ran the company for eight years under Icahn, will continue to run the company’s day-to-day operations.
"The first part of the transaction will be focused on tightening up our operations," Brown said after the hearing. "It’s about operating more efficiently and driving more revenue."
Brown said that while Icahn was brilliant in the way he was able to maximize his returns with well-placed capital investments, he wasn’t willing to commit to a large redevelopment of the Stratosphere.
Neilander said he was looking forward to seeing what direction the new owners will take the company.
"Icahn has gotten everything he can out of it," Neilander said during the hearing. "It’s a good thing to have new tutelage and retooling."
The purchase is being backed by a $4.8 billion Whitehall fund, Rothenberg said.
Regulators were told $54 million from the financing will be used for capital-expenditure projects immediately: $25 million for renovations at the Stratosphere, $10 million at Arizona Charlie’s Decatur for a new bingo room, and $19 million for room renovations at the Aquarius.
The buyout is Whitehall’s second foray into local gaming, with the investment branch holding a 40 percent share in the Las Vegas Hilton through WH/LVH Managers Vetco.
Contact reporter Arnold M. Knightly at email@example.com or (702) 477-3893.SALE OF BINION’S RECOMMENDED Binion’s sale to Four Queens owner Terry Caudill for $32 million was endorsed by the state Gaming Control Board on Wednesday. The struggling downtown property, which is owned by MTR Gaming of Chester, W.Va., will continue to be marketed under the Binion’s name. Caudill told regulators he plans to renovate the hotel rooms, refurbish some of the public areas and complete a changeover of the slot machines to ticket-in ticket-out. He added that he wants to bring in some specialty restaurants and new entertainment options to give the place a little more "pizazz." He also said he is looking at the possibility of adding hotel rooms to the 366-room hotel. Caudill said he intends to retain all the current employees but hedged the statement, saying his Four Queens operator will help analyze Binion’s operations department by department. ARNOLD KNIGHTLYREVIEW-JOURNAL