View of the Revel Atlantic City Resort Property under construction, photographed Thursday, October 27th, 2011.
CAMDEN, N.J. (AP) A federal judge will consider the proposed sale of Atlantic City’s former Revel casino to the runner-up bidder in last year’s bankruptcy court auction.
But how much Florida developer Glenn Straub should pay for it remains in dispute as the issue is reviewed in court.
After a deal to sell Revel to a Canadian firm for $110 million fell through last year, the casino’s management turned to Straub’s Polo North Country Club as the backup bidder that offered $95.4 million. But Straub said the price should be less now.
His attorney, Stuart Moskovitz, said the initial bid of $90 million should be in effect “because we believe the entire bidding process was tainted.”
He objected and asked the court to set aside the auction results last year after it emerged that Revel attorneys had represented the Canadian firm that won the auction, Brookfield Asset Management, in unrelated matters. Judge Gloria Burns overruled those objections, ruling that the process was fair and approved the sale to Brookfield.
But Brookfield pulled out of the deal in November, citing a dispute with bondholders over debt from the construction of Revel’s costly power plant.
Straub also is seeking a $3 million breakup fee it said is due to it as the initial bidder in a sale that was not completed. That would lower its $90 million bid to $87 million.
Revel shut down on Sept. 2 after little more than two years of operation in which it never turned a profit. It was one of four Atlantic City casinos to close in 2014.
Straub said he does not want to inherit any of Revel’s existing contracts, including one for the power plant that locks in what many industry observers consider unusually high rates that would place the casino at a significant disadvantage in the market.
“Everything is up for negotiation,” Moskovitz said. “We’re not assuming anything.”