Tribune wire report
12:01 PM EDT, June 27, 2014
Debt-strapped casino operator Caesars Entertainment Corp said it will shut its Showboat Atlantic City casino in August due to falling revenue and high property tax in Atlantic City.
Revenue from Atlantic City has declined by more than $3 billion since 2006 while competition has grown, Chief Executive Gary Loveman said in a statement.
The company brought the Mardi Gras-themed Showboat property into its fold when it bought Showboat Inc for about $512 million in 1998. It also took on about $635 million of Showboat debt through the deal.
Caesars said on Friday it would provide preference to the displaced Showboatemployees for available positions at its other three properties in the city. The company had about 68,000 employees at the end of last year.
The company operates 40 casinos in the United States and 14 outside the country, according to its website.
The 108,900-square foot Showboat property has 1,330 hotel rooms and suites.
In May, Caesars reported a 14 percent drop in revenue and $50.2 million loss from operations from the city in the first quarter.
Overall, revenue dropped 2 percent to $2.1 billion for the company. Atlantic City accounted for 15 percent of the total.
The company has $23 billion in debt, and is likely to enter into a restructuring agreement with bondholders within a year, Loveman said on Thursday.
Caesars' shares were little changed at $17.76 on the Nasdaq on Friday.
Copyright © 2014, Reuters