|By Steve Green, Las Vegas
SunMcClatchy-Tribune Regional News
March 10, 2011--Green Valley Ranch hotel-casino in Henderson will remain part of the Station Casinos' Las Vegas locals gaming empire under plans announced today.
Station Casinos LLC, the company created to buy most of the assets of the bankrupt Station Casinos Inc., today said it reached agreement with lenders to buy Green Valley Ranch Resort for $500 million.
The agreement involves a voluntary prepackaged bankruptcy reorganization filing to be made next month for the 496-room Green Valley Ranch Resort, which was developed by affiliates of the Fertitta family's Station Casinos and the Greenspun family, owner of the Las Vegas Sun.
The agreement includes an option for the Greenspuns to maintain an equity stake.
Bruce Deifik, president of The Greenspun Corporation, said the Greenspuns have appreciated working with the Fertittas in their gaming partnerships.
"We look forward to having the opportunity to work with them again," he said.
"We are pleased to have reached agreement with the first lien lenders to acquire Green Valley Ranch Resort," said Frank Fertitta III, chairman and CEO of both Fertitta Entertainment and Station Casinos Inc. "This transaction will allow us to keep Green Valley Ranch Resort in the Station Casinos' family, retain all of our team members, and continue to serve our loyal guests, all of which are very important to us."
In court filings last year, Station warned Green Valley Ranch was facing default on more than $750 million in secured debt as the recession reduced revenue and cash flow at the property.
Green Valley Ranch was not part of Station Casinos' 2009 bankruptcy, though the Station subsidiary that manages the property, GV Ranch Station Inc., did file for bankruptcy protection last year.
Station Casinos LLC, the company created to buy the old Station assets out of bankruptcy, is controlled by parties including lenders Deutsche Bank and JPMorgan Chase and investors led by members of Station's founding Fertitta family -- Frank Fertitta III and his brother Lorenzo Fertitta.
The old Station Casinos filed for bankruptcy after the recession left it unable to cover debt obligations. The company had $5.9 billion of long-term debt as of Sept. 30.
The deal for Green Valley Ranch was reached with the Greenspun/Station entity that developed the property and with lenders holding more than 90 percent of the dollar amount of the first lien debt, Station said. Financing for the purchase will include a new credit facility, Station said.
The plan will result in Green Valley Ranch Resort becoming a wholly-owned subsidiary of "New Station," or Station Casinos LLC.
Plans call for Fertitta Entertainment to manage Green Valley Ranch Resort under a long-term management agreement.
Station has not yet reported fourth quarter financial results. For the third quarter, Green Valley Ranch generated adjusted EBITDA before management fees of $9.6 million, an increase of 12.9 percent compared to the same period in the prior year. Green Valley Ranch reported a net loss of $9.7 million for the third quarter as compared to a net loss of $12.5 million in the same period of 2009, Station said.
EBITDA is a profitability measure meaning earnings before interest, taxes, depreciation and amortization.
The agreement was announced one day after Bloomberg News reported creditors including TPG Capital and Apollo Global Management were negotiating an agreement to take over Aliante Station, another Greenspun/Station joint venture in North Las Vegas.
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