"We would be interested in pursuing a transaction to acquire the Station assets as either a "stalking horse bidder"… or as a co-sponsor or plan proponent in a consensual plan of reorganization or, in the alternative, as a competing plan proponent," William Boyd and Kenneth Smith Boyd, Boyd chairman and chief executive, respectively, states in the letter, which was sent to Station's top executive Frank Fertitta III and signed by Boyd executives William Boyd and Kenneth Smith.
Now known as the "OpCo" assets, Texas Station, Santa Fe Station and Fiesta casinos represent all of Station's properties not secured by either the $2.47-billion CMBS mortgage loan and related mezzanine financings due Nov. 12, 2009 ("PropCo Assets"), or Station's $250 million delay-draw term loan due Feb. 7, 2011 ("LandCo Assets").
Boyd's letter said its offer "would present a superior recovery to the unsecured creditors of Station versus the current Exchange Offer" but also said the offer is subject to "substantial" change because it is thus far based on "very limited" publicly available information. Station's would-be prepackaged bankruptcy offers to pay investors 10- to 50 cents on the dollar in secured notes and cash in exchange for some $2.3 billion of existing bonds. Affiliates of the Fertitta family and Colony Capital have agreed to put up as much as $244 million in new capital to maintain their current interests in the company, according to Station Casinos.
Boyd says it has retained UBS Securities LLC as its financial adviser in connection with its evaluation of Station, which is expected to file for bankruptcy after bondholders vote on the exchange offer. The offer expires March 2, 2009.
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