Fertittas putting another $73 million into Station Casinos
7 February 2012
Station Casinos LLC executives Frank Fertitta III and Lorenzo Fertitta plan to invest another $73 million in the Las Vegas company by buying out another shareholder.
In another indication of the Fertitta brothers’ support for the company and their belief in the struggling locals gaming market, Station disclosed Monday that a company affiliated with the Fertittas plans to buy certain ownership units held by JPMorgan Chase Bank N.A.
The deal, if consummated, could mean JPMorgan could lose its rights to appoint one of Station’s “board of managers.” In 2010, it was revealed JPMorgan would appoint veteran gaming executive Stephen Greathouse to the board.
JPMorgan acquired its ownership stake in Station last year under a deal in which some of its debt was converted to equity during the Station bankruptcy process.
Monday’s disclosure by Station means the Fertitta brothers have now invested — or agreed to invest — some $273 million into the company to maintain control of it following its 2009 bankruptcy filing.
As Station was emerging from bankruptcy last year, four of its largest casino resorts were essentially foreclosed on by lenders Deutsche Bank and JPMorgan Chase, which were owed $2.475 billion. The Fertittas maintained equity interests in those resorts as well as management contracts.
The Fertittas teamed up with certain lenders to buy another group of casinos out of the bankruptcy for $772 million.
As it was emerging from bankruptcy, the Las Vegas locals’ gaming leader said Frank Fertitta III would continue in his role as CEO while Lorenzo Fertitta was appointed as a manager.
Separately, Station disclosed Monday that its full-year financial report will show net revenue in 2011 held steady at about $1.178 billion versus $1.114 billion in 2010.
EBITDA — a key profitability measure — also was steady at $284 million versus $280.1 million in 2010, Station said.
EBITDA means earnings before interest, taxes, depreciation and amortization.
Like other locals gaming companies, Station has seen its results hurt during the recession by consumers limiting spending due to worries about foreclosures and unemployment.
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