NEW YORK, March 22 (Reuters) - Casino operator Herbst Gaming Inc said on Sunday that it filed for Chapter 11 bankruptcy protection based on a previously arranged deal with its lenders.
The company said it would keep operating under the direction of current management, and that the restructuring agreement would follow terms outlined in an accord with lenders earlier this month.
The company, based in Las Vegas, plans to split its casino and slot machine operations into two separate holding companies, it said in a statement.
'Since we already have an agreement in place on a restructuring with our secured lenders, the company expects to confirm the plan of reorganization expeditiously and without disruption to our business,' Chief Executive Troy Herbst said in a statement.
Herbst said it plans to keep paying employees and honoring benefits without interruption or delay, and said suppliers would be 'paid in the ordinary course throughout this process.'
The company, which owns and operates more than 6,800 gaming machines and owns 12 casinos in Nevada, two in Missouri and one in Iowa, filed for bankruptcy protection in Reno, Nevada.
Under the agreement with its lenders, after the company is separated the Herbst family will receive 90 percent of the shares in the new slot machine company. Bank lenders will get 100 percent of the new equity of the casino company.
All Herbst Gaming's outstanding debt obligations under its senior credit facility, about $847 million, will be converted into debt and equity of the reorganized companies, it said.
The plan also calls for the termination of all obligations under the company's 8.125 percent Senior Subordinated Notes and 7 percent Senior Subordinated Notes.
(Reporting by Paul Thomasch; editing by Richard Chang)
((paul.thomasch@thomsonreuters.com; 1 646 223-6092; Reuters Messaging: paul.thomasch.reuters.com@reuters.com)) Keywords: HERBST/BANKRUPTCY (Visit http://blogs.reuters.com/mediafile/ for more coverage at the Reuters MediaFile blog) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The company said it would keep operating under the direction of current management, and that the restructuring agreement would follow terms outlined in an accord with lenders earlier this month.
The company, based in Las Vegas, plans to split its casino and slot machine operations into two separate holding companies, it said in a statement.
'Since we already have an agreement in place on a restructuring with our secured lenders, the company expects to confirm the plan of reorganization expeditiously and without disruption to our business,' Chief Executive Troy Herbst said in a statement.
Herbst said it plans to keep paying employees and honoring benefits without interruption or delay, and said suppliers would be 'paid in the ordinary course throughout this process.'
The company, which owns and operates more than 6,800 gaming machines and owns 12 casinos in Nevada, two in Missouri and one in Iowa, filed for bankruptcy protection in Reno, Nevada.
Under the agreement with its lenders, after the company is separated the Herbst family will receive 90 percent of the shares in the new slot machine company. Bank lenders will get 100 percent of the new equity of the casino company.
All Herbst Gaming's outstanding debt obligations under its senior credit facility, about $847 million, will be converted into debt and equity of the reorganized companies, it said.
The plan also calls for the termination of all obligations under the company's 8.125 percent Senior Subordinated Notes and 7 percent Senior Subordinated Notes.
(Reporting by Paul Thomasch; editing by Richard Chang)
((paul.thomasch@thomsonreuters.com; 1 646 223-6092; Reuters Messaging: paul.thomasch.reuters.com@reuters.com)) Keywords: HERBST/BANKRUPTCY (Visit http://blogs.reuters.com/mediafile/ for more coverage at the Reuters MediaFile blog) COPYRIGHT Copyright Thomson Reuters 2009. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.