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Station Casinos Fending Off Bankruptcy
LAS VEGAS, NEVADA --
Station Casinos is fighting to keep its corporate head above water. The chain of budget-conscious casinos, run with locals as a main segment of its market, has been attempting to rework its debt to no avail.
Station had offered holders of unsecured bonds an exchange, giving them new bonds with secured terms, but at a significant discount to the casino operator. Senior note holders were offered $540 per $1000 of debt, and subordinated bond holders were offered only $200 per $1000.
A lawyer representing the debt holders told Station in a letter the offer was insufficient. Station must still find a way to either refinance debt or renegotiate bank terms, or face breaking loan covenants by the end of the month.
KDP Investment Advisors analyst Barbara Cappaert said, "If the situation is not resolved and the pending bank violations are not fixed, Station is at risk of a chapter 11 filing."
The casino operator has been trying to find every means to cut expenses while rearranging debt as means to avoid bankruptcy. Just a week ago, the company announced it would no longer be matching 401(k) contributions from employees. The move was lauded as an alternative to laying off employees.
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