Casino Miami Jai Alai (ALM Media)
ABC Funding LLC, the main adversary in a bankruptcy case involving Casino Miami Jai Alai, bought the gambling operation for $155 million in a bankruptcy auction.
Florida Gaming Corp., owner of the casino, auctioned the property Tuesday to its primary lender amid competition from other bidders—Z Cap Florida Gaming LLC and Silvermark LLC, and GLP Capital/MGA Holding.
Silvermark was the original suitor for Miami Jai Alai, offering $114 million to buy it in 2012.
Florida Gaming filed for Chapter 11 bankruptcy protection last Nov. 8 and alleged Silvermark wasn’t able to complete the acquisition because of interference from New York-based ABC Funding. The company led a lending syndicate that provided an $87 million loan to repay existing debt and build a 60,000-square-foot casino at the jai alai fronton near Miami International Airport.
The auction was conducted by Luis Salazar of the Salazar Jackson law firm of Miami, Florida Gaming’s attorney, at the Biltmore Hotel in Coral Gables.
Silvermark had a stalking horse agreement with Florida Gaming and bid $115 million plus the assumption of about $14 million in debt. The company was represented by Thomas Kreller of Milbank Tweed Hadley & McCloy in Los Angeles and Craig Rasile of DLA Piper in Miami.
ABC Funding was represented by Drew Dillworth of Stearns Weaver Miller Weissler Alhadeff & Sitterson in Miami as well as Dennis Twomey and Andrew O’Neill of Sidley Austin in Chicago.
“Since last August, we have been working toward a positive resolution to this case that would benefit not only those involved but also the surrounding community,” Salazar said. He credited the work of the jail alai management team “building a successful casino.”
Last month, Salazar won a $35 million summary judgment against ABC Funding in Miami Jai Alai’s Chapter 11 bankruptcy. U.S. Bankruptcy Judge Robert Mark in Miami reduced the lender’s claim by a portion referred to as a “repurchase obligation,” arguing that made it an equity interest convertible to common stock.
The ruling helped other creditors by putting that portion of ABC Funding’s claim secondary to theirs.
Florida Gaming borrowed $87 million from ABC Funding to expand and renovate the casino at 3500 NW 37th Ave., which opened under Florida Gaming management in January 2012.
Z Cap Florida Gaming was represented by Martin Barash of Klee, Tuchin, Bogdanoff & Stern in Los Angeles. The company was formed by the Chicago-based Z Capital Partners private equity firm.
GLP Capital/MGA Holding, a joint venture with Connecticut’s Mohegan Gaming Authority and Indianapolis-based GLP Capital, was represented by Evan Levy of Skadden, Arps, Slate, Meagher & Flom in New York. GLP, a real estate investment trust which spun off from Penn National Gaming Inc. last year, owns the real estate associated with 21 casinos.