Station Casinos File For Bankruptcy

Station Casinos Inc has joined Trump Entertainment, Las Vegas Tropicana and others as the latest to file for chapter 11 after talks between them and their creditors failed to yield any outcome.
Station was started back in 1976 by the Fertittas family, who opened the one casino and soon expanded their Western style businesses which aimed for local, mid-range gamblers. Their properties included Gold Rush Casino and Texas Station Gambling Hall and Hotel. More recently, the company had started entering the higher end of the market and opened several casinos in the Las Vegas Strip.
Bondholders are owed $2.3 billion of the outstanding $5.7 billion debt and Mr Friel, Station Chief Accounting Officer said: “we feel it’s helpful to have the formal court process to resolve some of the issues. You’ve got a whole bunch of different constituencies who have a bunch of agendas on how they want the world to be. This will hopefully help us move closer to getting a deal done,”
The Las Vegas based company was able to shield 18 of its casinos on the West Coast from being included in the bankruptcy. The casinos are owned in whole by Station but it is the parent company that is responsible for all of the debt.  Chairman and chief executive officer, Frank Fertitta III said:“Station Casinos is a great company and our 18 casinos and resorts continue to generate positive cash flow, but the global recession has severely impacted our company, just as it has every other company in the gaming industry,”
Gambling businesses have been hit hard lately by a slump in tourism and cut backs in corporate spending.  Las Vegas Sands Corp., MGM Mirage and Harrah’s Entertainment Inc. are also facing tough times as they try to lower their debts in the face of the recession. There may be a silver lining on the horizon, though as stock prices of some of the bigger casino businesses rose last week.