Historic Atlantic City Casino Given to Lenders

The first casino in the US outside Nevada completed a deal to keep it operating by letting lenders take the gambling venue in exchange for dropping the debts owed.

Resorts Atlantic City, notable for being the first modern legal casino outside Nevada, was released by its owners to lenders in a deal approved by regulators yesterday. The New Jersey Casino Control Commission said it would allow the casino's lenders to take control of the gambling facility in exchange for a cancellation of debts owed.

The move allows the first casino to open in Atlantic City after the legalization of casino gambling in 1978 to continue to operate. Without a deal, the gaming venue was almost certain to close, as operators could no longer pay the mortgage and other bills.

A new corporation known as RAC Atlantic City Holdings LLC was formed by the consortium of lenders, which includes Wells Fargo, to operate Resorts. Regulators gave the new company a one-year casino license.

Nicholas Ribisi, who co-owned the casino with Colony Capital, will continue to carry an interest in the resort, as well as manage the property. Ribisi also retains ownership of the gaming equipment inside the casino.

Ribisi vowed to stay involved, and told the New York Times that he'd work to improve the casino and potentially buy it back from the holding company.

Resorts' debts were revealed to be $337 million more than the sum of its assets.