Tropicana Files For Bankruptcy, Casinos Still Operational

Las Vegas,NV (AHN) - Tropicana Entertainment LLC, owners of Tropicana Resort in Las Vegas and Atlantic City, has filed for Chapter 11 bankruptcy Monday but said its game houses will remain operational through the proceedings.

The bankruptcy filing allows Tropicana to renegotiate its $2.8 billion debt, at the same time use its revenue for operations instead of debt payments.

According to reports, Tropicana's problems began when Wimar Tahoe Corp. bought Aztar Corp. for $2.1 billion in January 2007. Aznar owned five casinos including the Tropicana Las Vegas and Atlantic City, for which the Wimar Tahoe renamed itself.

Due to the economic slowdown, the company embarked on a cost-cutting program. This, however, resulted in the New Jersey Casino Control Commission declaring Tropicana unfit fit to operate the casino and stripped it of its license.

AFP quoted Tropicana spokesman Hud Englehart saying, "We ran into a perfect storm."

Tropicana Entertainment owns 13 casinos with 11,000 employees in five states. However, the Chapter 11 filing only covers nine of the Kentucky-based operator's casinos. Two others, the Amelia Belle Casino in Louisiana and the Westin Casaurina in Las Vegas, are affiliate owned.

The Tropicana Atlantic City, on the other hand, is under state custody. The state of New Jersey is overseeing that the property gets sold before the June 9 deadline.