International edition
September 19, 2021

Auction would determine if Carl Icahn’s us $ 156.2 million offer is topped

Deadline for Fontainebleau bids set for Friday

(US).- Bids are due Friday from companies and individuals wanting to buy the bankrupt Fontainebleau casino-resort development project on the Las Vegas Strip. Parties desiring to take over the resort will have to offer more than the us$ 156.2 million currently offered by investment veteran Carl Icahn.

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eff Truitt, the examiner appointed to supervise Fontainebleau, plans to announce any qualified bids on January 19. If a qualified bid exceeds Icahn's offer, an auction is set for January 21.

Contractors claiming to be owed us$ 467 million for work on the resort had hoped to submit a "credit bid," with their claims serving as currency, as opposed to a cash bid. But because of uncertainties as to whether lenders or contractors hold first-priority liens on the project, Bankruptcy Judge A. Jay Cristol rejected their motion to credit bid.

Last month, he gave them the opportunity to appeal his ruling if they posted a bond equal to Icahn's bid, but the contractors chose not to post the bond. The bond would have covered potential losses to the bankruptcy estate because of the appeal.

The contractors and lenders are now engaged in litigation that may drag on for years to determine who will receive the cash proceeds from this month's bidding and auction process.

Interest in acquiring Fontainebleau has been limited because of difficult economic conditions in the gaming industry and the hundreds of millions of dollars, or billions of dollars, needed to complete the resort.

Icahn, who also controls Las Vegas-based gaming company Tropicana Entertainment LLC, hasn't disclosed plans for Fontainebleau should he acquire it.

It's unknown if other bids will come in for Fontainebleau, though Truitt said in a report Friday that "certain parties" have signed non-disclosure agreements and have been provided access to confidential Fontainebleau financial data.

Earlier interest in acquiring the project was shown by Penn National Gaming, which was outbid by Icahn to be the stalking horse bidder; and Apollo Global Management, one of the companies that controls Harrah's Entertainment Inc.

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