American Casino & Entertainment Properties

Last updated
American Casino & Entertainment Properties
TypePublic
IndustryGaming
FoundedDecember 29, 2003;19 years ago (2003-12-29)
DefunctOctober 2, 2017;5 years ago (2017-10-02)
Successor Golden Entertainment
Headquarters
Las Vegas, Nevada
,
United States
Number of locations
4
Area served
Global
ProductsCasinos, Resorts

American Casino & Entertainment Properties (ACEP) owned and operated 4 casinos. It was purchased by Golden Entertainment in October 2017 for $850 million. [1] ACEP was a casino holding company headquartered at the Stratosphere Las Vegas. [2] [3] ACEP was a wholly owned subsidiary of American Real Estate Partners before it was sold to Whitehall Street Real Estate Funds, an investment arm of Goldman Sachs, in February 2008. [4] [5] The company owned the following 4 casinos: Aquarius Casino Resort, Arizona Charlie's Decatur, Arizona Charlie's Boulder and Stratosphere Las Vegas. Golden Entertainment acquired ACEP from Whitehall.

Contents

History

Shortly after opening, the Stratosphere Las Vegas on April 30, 1996, the Stratosphere Corporation was forced to file for bankruptcy. After acquiring a majority of the bonds, ACEP gained control of the casino. Carl Icahn acquired the four properties for $300 million. [6]

On November 29, 2005, Harrah's Entertainment announced plans to sell the Flamingo Laughlin casino to ACEP. The sale closed on May 19, 2006, and the Flamingo Laughlin was renamed the Aquarius Casino Resort in October 2006. [7]

On April 23, 2007, it was announced that ACEP was being sold for $1.3 billion to Whitehall Street Real Estate Funds, an investment fund managed by Goldman Sachs. The sale closed on February 21, 2008. Although revenue for 2008 had only slipped by 4.47% from 2007, the interest costs of the acquisition had turned ACEP into a money losing operation. ACEP registered its first positive net income since 2007 of $7.0 million in 2014 and $12.1 million in 2015. [8] [9]

In 2007, Whitehall Street Real Estate Funds, who owned 40% of the Las Vegas Hilton and was a passive investor in other casino properties, made an offer of $1.3 billion for the four properties. The appraisal assigned a value of $718 million to the land under the four properties. The buildings were worth $366 million. The land valuation seemed to be almost entirely based on the undeveloped 17 acres (69,000 m2) of land near the Stratosphere.

On February 21, 2008, the ownership of ACEP changed hands from the previous owner, Carl Icahn, to Whitehall Street Real Estate Funds. The new owners retired the $255 million senior notes held by the former owner and replaced them with $1.1 billion in new notes held by Goldman Sachs Term Loans. The interest on these loans far exceeded the net income of the company in 2007. The income of the company had to grow to cover this new financing.

In 2008, ACEP completed $54.0 million in renovations at the Aquarius Casino Resort. [10]

By the 4th quarter of 2008, the company's revenue began plummeting precipitously. The cost of the acquisition was so considerable that the company was operating at a net loss. In March 2009, the company announced that it would begin layoffs. [11]

In May 2009, Whitehall was in discussions to restructure the debt with its lender, Goldman Sachs, due to concerns that the company could default if gaming and visitor numbers continued to decline. Whitehall, which is an affiliate of Goldman, was finalizing terms of an agreement that would see Goldman forgive $593 million of the $1.1 billion debt load. Whitehall would also be released from an additional $200 million in additional debt. In exchange for the debt relief, a mortgage unit of Goldman would gain a 22 percent interest in the company. [5]

In 2009, net revenue fell to $356 million, its lowest since 2005. The company restructured its debt in the last quarter and laid off 600 employees. [12]

In 2011, ACEP completed $20 million in renovations at the Stratosphere, updating its rooms and casino floor and promoted the changes within new marketing campaign. The Stratosphere also added a lounge called Sky Lounge 107 the 108th floor. In addition to the renovations, Stratosphere added a new thrill ride, the Sky Jump. [13]

By 2015, net revenues had increased to $373 million.

In June 2017, Whitehall agreed to sell ACEP to Golden Entertainment for $850 million. [14]

On October 2, 2017, Golden Entertainment closed on its $850 million purchase of the four casinos owned by ACEP. [1]

Properties

Related Research Articles

<span class="mw-page-title-main">Carl Icahn</span> American businessman and financier (b. 1936)

Carl Celian Icahn is an American financier. He is the founder and controlling shareholder of Icahn Enterprises, a public company and diversified conglomerate holding company based in Sunny Isles Beach. Icahn takes large stakes in companies that he believes will appreciate via changes to corporate policy and he then pressures management to make changes that he believes will benefit shareholders. He was one of the first activist shareholders and is credited with making that investment strategy mainstream for hedge funds.

<span class="mw-page-title-main">MGM Resorts International</span> Hotel and entertainment company

MGM Resorts International is an American global hospitality and entertainment company operating destination resorts in Las Vegas, Massachusetts, Detroit, Mississippi, Maryland, and New Jersey, including Bellagio, Mandalay Bay, MGM Grand, and Park MGM.

<span class="mw-page-title-main">Harrah's Entertainment</span> American gaming corporation

Harrah's Entertainment was an American casino and hotel company founded in Reno, Nevada, and based in Paradise, Nevada, that operated over 50 properties and seven golf courses under several brands. In 2013, it was the fourth-largest gaming company in the world, with annual revenues of $8.6 billion. It was acquired in 2020 by Eldorado Resorts, which then changed its own name to Caesars Entertainment.

<span class="mw-page-title-main">The Strat</span> Casino hotel in Las Vegas, Nevada

The Strat Hotel, Casino and SkyPod is a hotel and casino located in Las Vegas, Nevada, United States. It includes a 1,149 ft (350.2 m) observation tower, the tallest in the United States. It is also the second-tallest observation tower in the Western Hemisphere, surpassed only by the CN Tower in Toronto, Ontario. The tower is topped by a pod which includes a revolving restaurant, lounges, and observation decks. The top of the tower also has several thrill rides. The hotel and casino facilities are situated at the base of the tower, and the resort also includes a showroom and a shopping mall. The Stratosphere is located within city limits on Las Vegas Boulevard, just north of the Las Vegas Strip. The resort is sometimes considered to be a Strip property, although Clark County does not officially recognize it as such, stating that the Strip does not extend into city limits.

<span class="mw-page-title-main">Trump Entertainment Resorts</span> Defunct gaming and hospitality company

Trump Entertainment Resorts, Inc. was a gambling and hospitality company. The company previously owned and operated the now-demolished Trump Plaza and Trump World's Fair, the now-closed Trump Marina, Trump Casino & Hotel in Gary, Indiana, Trump 29 in Coachella, California, and Trump Taj Mahal in Atlantic City. It was founded in 1995 as Trump Hotels & Casino Resorts by Donald Trump, who after 2004 held only a minority ownership. The company filed for bankruptcy in 2004, 2009 and 2014. It became a subsidiary of Icahn Enterprises in 2016. Since then, all of the company's properties have been closed and sold.

Station Casinos, LLC is an American hotel and casino company based in Las Vegas suburb of Summerlin South, Nevada, and founded by Frank Fertitta Jr. Station Casinos, along with Affinity Gaming, Boyd Gaming and Golden Entertainment, dominate the locals casino market in Las Vegas. The company purchased several sites that were gaming-entitled, meaning that major casinos can be built at that location without additional approvals. There are only a limited number of such sites available in the Las Vegas area. Station Casinos has also branched out into managing casinos that they do not own. Red Rock Resorts, Inc. is a publicly traded holding company that owns a portion of Station Casinos.

<span class="mw-page-title-main">Pinnacle Entertainment</span>

Pinnacle Entertainment, Inc. was an American gambling and hospitality company. It was acquired by Penn National Gaming in 2018. At the time of acquisition, it operated sixteen casino properties, located in Colorado, Indiana, Iowa, Louisiana, Mississippi, Missouri, Nevada, Pennsylvania, and Ohio, and a horse track in Texas.

<span class="mw-page-title-main">Lake Las Vegas</span> Man-made lake in Nevada, United States

Lake Las Vegas in Henderson, Nevada, refers to a 320-acre (130 ha) reservoir and the 3,592-acre (1,454 ha) developed area around the reservoir. The area is sometimes referred to as the Lake Las Vegas Resort. It is being developed by 5 companies including Lake at Las Vegas Joint Venture LLC.

Icahn Enterprises L.P. is an American conglomerate headquartered at Milton Tower in Sunny Isles Beach, Florida. The company has investments in various industries including energy, automotive, food packaging, metals, real estate and home fashion. The company is controlled by Carl Icahn, who owns 88% of it.

<span class="mw-page-title-main">Aquarius Casino Resort</span> Hotel and casino in Nevada, United States

The Aquarius Casino Resort is a hotel and casino located on the banks of the Colorado River in Laughlin, Nevada. It is owned and operated by Golden Entertainment and is the largest hotel in Laughlin.

Golden Entertainment is an American gaming company based in Enterprise, Nevada that operates casinos, taverns and slot routes. It was formed in 2015 by the merger of Golden Gaming and Lakes Entertainment. It is the largest tavern operator and largest slot route operator in Nevada. In October 2017, the company completed an $850 million acquisition of American Casino & Entertainment Properties. The company now has 10 casino resorts, nine in Southern Nevada and one in Maryland.

<span class="mw-page-title-main">Park Place Entertainment</span>

Park Place Entertainment, later named Caesars Entertainment, Inc., was a casino company based in Paradise, Nevada. For a time it was the largest casino operator in the world. It was formed in 1998 as a corporate spin-off of the gaming division of Hilton Hotels, and renamed as Caesars Entertainment in 2003. The company was acquired in 2005 by Harrah's Entertainment, which later took on the Caesars Entertainment name.

<span class="mw-page-title-main">Tropicana Entertainment</span> Casino holding company in Las Vegas, Nevada

Tropicana Entertainment Inc. was a publicly traded gaming company that owned and operated casinos and resorts in Indiana, Louisiana, Mississippi, Nevada, Missouri, New Jersey. and Aruba. Tropicana properties collectively had approximately 5,500 rooms, 8,000 slot positions and 270 table games. The company was based in Spring Valley, Nevada, and was majority-owned by Icahn Enterprises. The company was acquired in 2018 by Eldorado Resorts and Gaming and Leisure Properties for $1.85 billion.

<span class="mw-page-title-main">Fontainebleau Las Vegas</span> Unfinished hotel and casino complex in Nevada

The Fontainebleau Las Vegas is a hotel and casino currently under construction on the Las Vegas Strip in Winchester, Nevada. It is on the 24.5-acre (9.9 ha) site previously occupied by the El Rancho Hotel and Casino and the Algiers Hotel. The project was announced as Fontainebleau Las Vegas in May 2005, with initial plans to begin construction by March 2006, and to have the resort opened by 2008. It was intended to be a sister property to the Fontainebleau Miami Beach hotel. It would be developed by Fontainebleau Resorts, which was owned by Jeff Soffer.

<span class="mw-page-title-main">Arizona Charlie's Boulder</span> Hotel and casino in Nevada, United States

Arizona Charlie's Boulder is a 301-room hotel and a 35,000-square-foot (3,300 m2) locals casino located in Paradise, Nevada, United States. It is owned and operated by Golden Entertainment. It is located on Boulder Highway between Boulder Station and Sam's Town.

<span class="mw-page-title-main">Downtown (Nevada gaming area)</span>

"Downtown Las Vegas Area" is the name assigned by the Nevada Gaming Control Board NGCB which includes the Downtown Las Vegas area casinos and the Stratosphere Tower which is located 2 miles (3.2 km) from Fremont Street. The city of Las Vegas uses the term Downtown Gaming for the casinos near the Fremont Street Experience. The land is part of the 110 acres (45 ha) that were auctioned on May 15, 1905 when the city was founded.

<span class="mw-page-title-main">Arizona Charlie's Decatur</span> Casino hotel in Las Vegas, Nevada

Arizona Charlie's Decatur is a 258-room hotel and casino with a 59,000-square-foot (5,500 m2) locals casino in the Charleston Heights area of Las Vegas, Nevada, United States. It is owned and operated by Golden Entertainment.

<span class="mw-page-title-main">Blake L. Sartini</span>

Blake L. Sartini is an American entrepreneur in the Nevada gaming and entertainment industry.

<span class="mw-page-title-main">Caesars Entertainment</span> American gaming company

Caesars Entertainment, Inc., formerly Eldorado Resorts, Inc., is an American hotel and casino entertainment company founded and based in Reno, Nevada that operates more than 50 properties. Eldorado Resorts acquired Caesars Entertainment Corporation and changed its own name to Caesars Entertainment on July 20, 2020.

Vici Properties Inc. is a real estate investment trust (REIT) specializing in casino properties, based in New York City. It was formed in 2017 as a spin-off from Caesars Entertainment Corporation as part of its bankruptcy reorganization. It owns 48 casinos, hotels, and racetracks and 4 golf courses around the United States and Canada.

References

  1. 1 2 "Golden closes on $850M deal for Stratosphere, 3 other casinos". 23 October 2017.
  2. ↑ "American Casino & Entertainment Properties LLC". Bloomberg L.P.
  3. ↑ Knightly, Arnold M. (April 24, 2007). "Icahn Sells Southern Nevada casinos". Las Vegas Review-Journal .
  4. ↑ Knightly, Arnold (January 10, 2008). "Stratosphere step closer to changing ownership". Las Vegas Review Journal.
  5. 1 2 Knightly, Arnold (May 14, 2009). "Stratosphere parent company posts $1.6 million net loss". Las Vegas Review Journal.
  6. ↑ "Icahn Boosts Federal-Mogul Stake to 75%". The New York Times . March 3, 2008.
  7. ↑ BONNAR, STACEY (May 20, 2006). "New owners take over at Flamingo". Mohave Valley Daily News.
  8. ↑ "American Real Estate Partners, L.P. Agrees To Sell Its Nevada Gaming Operations to Whitehall Street Real Estate Funds for $1.3 Billion" (Press release). PR Newswire. April 23, 2007.
  9. ↑ "Icahn to sell casinos for $1.3 billion". Los Angeles Times . Associated Press. April 24, 2007.
  10. ↑ American Casino & Entertainment Properties LLC 2012 Form 10-K Annual Report
  11. ↑ Finnegan, Amanda (4 March 2009). "Stratosphere to lay off workers, halt pay increases". Las Vegas Sun. Retrieved 17 September 2011.
  12. ↑ Knightly, Arnold (22 March 2010). "Stratosphere owner cuts losses by 30 percent". Las Vegas Review Journal.
  13. ↑ O’Reiley, Tim (January 14, 2011). "Stratosphere owners tout $20 million makeover". Las Vegas Review Journal.
  14. ↑ Velotta, Richard N. (June 12, 2017). "Owner of PT's Pubs to buy Stratosphere, 3 other Nevada casinos". Las Vegas Review-Journal. Retrieved 2017-06-12.
This page is based on this Wikipedia article
Text is available under the CC BY-SA 4.0 license; additional terms may apply.
Images, videos and audio are available under their respective licenses.