The Atlantic Club is going out with a sigh. After almost three and a half decades of existence, the casino at Boston Avenue and the Boardwalk in Atlantic City will turn off its lights.
On Monday, Judge Gloria M. Burns of U.S. Bankruptcy Court in Camden, New Jersey approved a deal in which both Caesars Entertainment and Tropicana Entertainment will purchase the casino and strip its carcass. Caesars will fork over $15 million for the property itself, while Tropicana will pay $8.4 for the 1,641 slot machines and 48 table games.
Sobe Holdings LLC had attempted to buy everything and objected to the agreement, but was overruled by Judge Burns. Sobe argued that Caesars was “not qualified” to purchase any of the Atlantic Club because of some of the company’s debt covenants that prevent Caesars from making a bid. The judge told Sobe’s attorney that all this should have been presented during the actual auction process and that it was too late.
The Atlantic Club originally filed for Chapter 11 bankruptcy in November and had indicated that it wanted to sell to someone who would actually keep it running. The Rational Group, parent company of PokerStars and Full Tilt Poker, had attempted to purchase the casino this spring for $15 million, but that deal fell through because of fears over whether or not Rational would be able to garner a casino license, as well as concerns about the April 2011 “Black Friday” indictment against Rational’s founder.
While Caesars is purchasing the casino and hotel property, it will not operate a fifth casino in Atlantic City. Instead, it will strip the property of its various non-gambling assets and send them off to its four existing local casinos: Harrah’s, Caesars, Bally’s, and Showboat.
Michael Frawley, chief operating officer of the Atlantic Club, expressed his regret over the circumstances:
First and foremost I would like to express my profound admiration and respect for the employees of this company. The events of the last few months have evoked an array of emotions, and through it all, the employees of the Atlantic Club have remained consummate professionals. It is because of these outstanding individuals that we were able to build considerable momentum over the last year. Unfortunately our pace was unsustainable in the extremely challenging Atlantic City gaming market.
Naturally, the 750 employees of the casino will be out of work soon. The Local 54 of the Unite-HERE union tried to put up a fight, but it was never going to succeed. Said union president Bob McDevitt, “While we can’t stop the Atlantic Club from closing, we are going to do everything we can to fight for the workers to get as much as possible in this tragic situation.”
The Atlantic Club is one of the oldest casinos in Atlantic City, built in 1980 by Steve Wynn’s Golden Nugget companies and Michael Milken. In fact, it was originally named the Golden Nugget. While we tend to think casino gambling has been a fact of life in Atlantic City forever, it was only legalized four years prior to Atlantic Club’s existence. In 1987, Wynn sold the casino to Bally Manufacturing, which changed the name to Bally’s Grand. It was changed again to the Atlantic City Hilton when the casino was sold to the Hilton Hotels Corporation. Another sale put the casino in the hands of Resorts International and its current name was introduced in 2012 when it was renovated and re-branded as a locals casino.
The Atlantic Club is scheduled to officially close on January 13, 2014.