Atlantic Club Casino Hotel to Close Next Month
The curtains are about to close on a story that has managed to remain in the headlines for most of 2013.
Today a federal judge approved the sale of the bankrupt Atlantic City land-based property the Atlantic Club Casino Hotel, which last month declared bankruptcy.
Caesars and Tropicana to purchase and shut down ACC
A partnership of Caesars Entertainment and Tropicana Entertainment entered the winning bid in an auction held last week.
The two companies have agreed to pay $23.4 million for the casino resort, which was first developed by casino mogul Steve Wynn in the early 1980’s and for a time was one of Atlantic City’s most profitable properties.
According to the Boston Herald, Tropicana Entertainment will be putting up $8.4 million in return for the Atlantic Club’s table games and slot machines. Caesars Entertainment will be forking over $15 million to acquire the hotel portion of the property.
It was reported last Friday that both companies were interested in acquiring the Atlantic Club essentially to shut it down in order to reduce competition given the tough gaming climate in New Jersey.
“We realize this is a difficult time for the employees of Atlantic Club and all those who have been part of the history of their operation,” said David Rebuck, head of the New Jersey Division of Gaming Enforcement.
“Competition is nothing new for New Jersey and it will be no different in 2014. No one likes to see a business close, but we are optimistic that market consolidation will result in a stronger and healthier hotel and casino industry in Atlantic City,” Rebuck remarked.
Atlantic Club has struggled along with NJ gaming industry
In recent years the fortunes of the Atlantic Club have gone the way of Atlantic City as a whole, with pressure from casinos across state lines exacting an increasing toll on the revenue flow of what was once the largest gambling market on the east coast, a title that last year was usurped by neighboring Pennsylvania, which rose to become the second-largest gambling market in the United States.
The last casino to shut down in Atlantic City did so in 2006. That was the Sands, a property that was closed in order to be demolished ahead of the construction of a new casino property that never wound up being built.
The land on which the Sands formerly sat remains a vacant lot.
PokerStars attempted to purchase ACC earlier this year
Last spring, a deal that would have seen the world’s largest real money online poker site, PokerStars, purchase the Atlantic Club infamously fell through when the ACC terminated the deal in a move that was said to have “blindsided” the online poker giant.
The Atlantic Club pointed to PokerStars’ failure to secure an interim operating license from New Jersey regulators prior to a contractually-stipulated date as the reason for canceling the sale, which PokerStars sued – and failed – to keep on track.
The purchase of the Atlantic Club was one avenue that PokerStars attempted to use to enter the nascent New Jersey online betting market, being that state law requires all Internet betting operations be tied to a land-based casino in Atlantic City.
A New Jersey judge ultimately ruled that the Atlantic Club was within its rights to abort the deal, and the casino was permitted to keep $11 million that PokerStars had already paid toward a total $15 million purchase price, money that was said to be fronted to help pay employees and keep the casino doors open.
PokerStars, which quickly went on to partner with another Atlantic City casino – Resorts, the city’s oldest property – earlier this month found its New Jersey iGaming application essentially placed on hold, with regulators willing to revisit it should the company enact significant changes in terms of executive personnel.
Resorts, meanwhile, has been give the go-ahead to launch a real money betting web site. It remains unclear whether or not Resorts will be seeking out a new casino partnership.
