Atlantic Club Casino Eliminated for Good in NJ’s Internet Gambling Market
The Atlantic Club (AC) Casino’s bankruptcy proceedings culminated in a two-day closed-door auction last December 17, 2013. The results of which, nixed all possibilities of seeing the financially-troubled casino hotel joining New Jersey’s newly launched online gambling industry. Instead of ending up with a new owner who will revitalize and run its flailing operations, the bankrupt casino’s assets will go to two major buyers, namely Caesars and Tropicana.
Caesars was able to acquire the property including the 800 hotel rooms at a price of $15 million, while Tropicana purchased the casino’s gaming equipment comprising slot machines and table games for $8.4 million. Although a total of $23.4 million will be realized from the sale, as much as $16.8 million will be distributed to AC casino’s creditors to settle all outstanding liabilities. The liquidation proceedings will leave the AC’s owner, hedge fund company Colony Capital LLC, a relatively measly amount to show as return for the more than a half-billion dollar price paid for, when it acquired the hotel casino in 2005.
A Caesars spokesperson disclosed that the casino giant has no plans of continuing AC’s hotel operations after it officially closes on January 13, 2014. Actually, Caesars’ move to acquire the bankrupt hotel casino is regarded by many as a strategic action to block another competitor, from entering Atlantic City’s diminishing gambling market. Observers recall that Caesars is among those who strongly opposed the acquisition deal between Atlantic Club casino and PokerStars, because the latter is a force to contend with as far as online poker offerings are concerned.
However, as events slowly unfolded, PokerStars lost its bid to secure a gaming license in the Garden State due to suitability issues; such a condition would have voided the AC-PokerStars purchase deal just the same.