February 18, 2010 / 9:25 PM / 9 years ago

Icahn takes over Fontainebleau's Las Vegas hotel

NEW YORK (Reuters) - Investor Carl Icahn took ownership of the unfinished Fontainebleau Las Vegas Resort on Thursday, paying its bankrupt owner about $104.6 million in cash.

Icahn also forgave about $49 million in debtor-in- possession financing as part of the deal, according to Scott Baena, bankruptcy counsel at Bilzin Sumberg to the company.

The Fontainebleau filed for bankruptcy protection last June after lenders cut off access to nearly $800 million of construction funds. The 3,800-room casino resort, toward the northern end of the Las Vegas Strip, has already cost $2 billion.

Casinos have been hard hit by the downturn in the economy as consumers have held back on discretionary spending, like gambling.

Following the asset sale, the holding company will liquidate through bankruptcy company, Baena said.

The case is in re: Fontainebleau Las Vegas Holdings LLC, U.S. Bankruptcy Court, Southern District of Florida, No. 09-21481.

Reporting by Caroline Humer; editing by Andre Grenon

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