Detroit casino expansion a go despite bankruptcy filing

Detroit casino expansion a go despite bankruptcy filing The planned $500 million expansion of Detroit's Greektown Casino will continue, despite its filing for bankruptcy protection, representatives said last week. Greektown Casino, one of the three non-tribal casinos in Michigan (although its majority owner is the Sault Ste. Marie Tribe of Chippewa Indians), filed for Chapter 11 bankruptcy protection last Thursday, after failing to meet the terms of a credit line. The casino also said that employees job cuts aren't expected at this time. "As we reorganize our business and complete our permanent casino construction with additional financing, the goal is a bigger and more viable Greektown Casino. With the support and confidence of our creditors, we have developed a plan to reorganize our business, and we will be implementing these action steps," casino management board Chairman Tom Miller said in a statement.

Greektown said in a court filing its failure to comply with loan agreements with Merrill Lynch, Pierce, Fenner & Smith Inc. meant it couldn't draw money from its credit line and made it difficult to incur new debt without bankruptcy protection. That loan was $314.5 million as of March 31st, the filing said. According to the bankruptcy papers, the casino needs to borrow $140 million to complete its construction, but casino officials said Friday it was finalizing $150 million in financing with its banks to continue operating and finish building its expanded gambling floor and adding a 400-room hotel (see photo). So far Greektown Casino has paid $184 million on its permanent casino construction project.

Published on 06/02/2008