Station Casinos Can't Fend Off Bankruptcy Any Longer

After six months of trying to come to new terms with lenders, Station Casinos conceded the inevitable and declared bankruptcy.

After months of struggling to arrange its affairs prior to seeking bankruptcy protection, Station Casinos declared for Chapter 11 today. The Las Vegas-based casino company was unable to reach a prepackaged bankruptcy deal with lenders, meaning a messier and almost certainly longer stay in insolvency for the company.

Station Casinos had missed a payment to creditors at the beginning of the year, and since then has used several extensions granted by bondholders to try to work a deal allowing the casino operator to rework its debt situation. The company owes almost $6 billion, much of which was taken on to take the company private just before the recession hit.

Station said its eighteen casinos are registered as separate entities and will operate as usual. All debt is in the name of the parent company.

Noting that months of negotiations were not enough to reach a bondholder accord, Tom Friel,Station's Chief Accounting Officer, said it was time for the court process to decide how the company may proceed.

"You've got a whole bunch of different constituencies who have a bunch of agendas on how they want the world to be," Friel told the Wall Street Journal. He noted the variety of bondholders left making an overall arrangement problematic.

Thus far, Station has fended off overtures from rival Boyd Gaming toward the company's Vegas gambling operations. But a court ruling may make retaining the casino assets more difficult.