Another one goes down in the gaming industry. This time it is the Riviera Holdings Corp. that owns a number of casinos in Las Vegas and Colorado. It filed for Chapter11 bankruptcy in the U.S. Bankruptcy Court in Las Vegas on Monday. The current recession has been taking toll on most such companies, some of which have even gone bankrupt. Their main holdings are the Riviera hotel-casino on the Las Vegas Strip and the Riviera Black Hawk in Colorado.
Its debts go up to a whopping $247.7 million. Since a Chapter11bankruptcy reorganisation has been filed, people are hopeful that the company properties will function as usual during the whole process. The main reason stated for this cash crunch is the company’s declining value due to the recession, which has led to the shrinking of its assets as compared to its liabilities. Atleast that is what the company said when filing for bankruptcy.
Their attorney said: “Debtors were faced with declining hotel and casino revenues based on reduced consumer spending, a tightening credit market, and an overall weakening economy. Most of these market-driven challenges manifested after the debtors leveraged themselves with the Senior Credit Facility and the secured hedging agreement, thus leaving the debtors in a highly precarious position at a time when they most needed robust financial performance.”