April 29, 2009 / 5:44 PM / 10 years ago

NJ approves Tropicana Atlantic City auction

LOS ANGELES, April 29 (Reuters) - New Jersey regulators on Wednesday approved plans to auction the Tropicana Casino Resort in Atlantic City through a bankruptcy court, with a $200 million offer from a group of its lenders, including billionaire investor Carl Icahn, serving as a floor for bids.

“This bankruptcy filing is not the result of financial distress, but it is one that will allow the conservator to sell the casino hotel complex free of all liens and encumbrances,” Linda Kassekert, chairwoman of the New Jersey Casino Control Commission, said in a statement.

The deadline for selling the property was extended to the end of this year.

The commission in December 2007 appointed a conservator to oversee the Tropicana after voting not to renew the casino’s license amid complaints about hotel operations and compliance with gambling regulations.

Conservator Gary Stein came close last year to selling the property to real estate developer Cordish Co for $700 million, but that deal fell apart as the economy soured.

Before being placed in a trust by the state, Tropicana Atlantic City was owned by Tropicana Entertainment, an indirect subsidiary of Tropicana Casinos and Resorts, which owns the famed Tropicana casino in Las Vegas.

Tropicana Entertainment, which filed for bankruptcy last year, was created by hotel and casino investor Columbia Sussex Corp when it bought rival Aztar Corp for $1.9 billion in 2006. (Reporting by Deena Beasley; Editing by Lisa Von Ahn)

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