Hooters hotel-casino says bankruptcy possible

Hooters year end report came in. The casino only made $18 million in 2009. Total revenue is down to $46 million (from $66 million in 2007). They were losing money two years ago so now they may be giving up the ghost.

Just to show you how bad that it, the Hotel San Remo in 2004 was making $12.7 million in the casino and $33.1 million overall. The casino sold for $74 million and $190 million in upgrades.

It goes to show you how hard it is to fit in one of these niche markets. They never could earn anywhere near enough to pay for the acquisition and renovations that they did years ago.

If they just close the place it may help Tropicana's efforts to remodel and attract the budget customer. But it seems like nothing closes, it just gets sold and remodeled.

I started this idea on another thread, but I would like to repost since I've had more time to think about it. Plus I found more operational data on Hooters.

--- CURRENT FINANCIAL STATE OF HOOTERS CASINO --
Hooters will certainly go bankrupt soon. The casino revenue of $18m last year is equivalent to $50K per day.
Table games made $6.7 million ($18,356 per day) for 24 table games
Slots made $11.0 million ($30,137 per day) $49 per machine per day for 613 machines
Poker made $0.4 million ($1,096 per day)

Pit revenue is $32 per occupied room per night. I am guessing that most of the pit players are staying in the hotel, as are most of the slot players

Looking at five equivalent casinos near the strip (RIVIERA, CASINO ROYALE, SLOTS-A-FUN, TERRIBLE'S, TUSCANY) the slot average is $76 per machine per day). Two year's ago Hooters notice this discrepancy and said We believe that our slot revenue win per unit can be increased to a more competitive level in future periods by focusing on special slot promotions, direct marketing programs and other programs targeted to increase casino traffic. Clearly those efforts were not successful.

The pit revenue is very small to a the major strip casinos which would earn 2.5 times that amount on the same collection of games.

Average daily room rate decreased to $49 from $66 in 2008.

Their 6 executive probably don't want to lose their salaries
Chief Operating Officer = $300,000
President = $275,000
Sr. VP of Food & Beverage = $170,887
Chief Financial Officer = $170,887
VP of Human Resources = $112,645
Chief Executive Officer = $100,000


--- BROAD OUTLINE OF THE PLAN --
The idea is to give guests the option of paying a surcharge on their room to let them play the pit games. In exchange the pit game pays would be reduced to the point of almost zero house average. After crunching the numbers I have decided that the only way to make this work is to have it as a limited happy hour for two hours a night probably 6-8 PM. There would also be a late night session (2-4 AM). A third session would be from (9-11AM). You would annoy some players who don't want to pay the fee, but it is a necessary risk.

Although originally I wanted to convert the casino entirely to pay for play I decided it was non-functional idea. The problem is that if you change it for the night you have to be limited in the number of passes that you sell. Once people pay for this right, they will get upset if positions are not available in the pit. You simply can't replace the normal revenue for the evening with fees.

The entry fee would be $50 for the two hours. Both craps tables and both roulette tables and half the blackjack tables would be available.

The two proprietary games (let it ride and 3 card poker) would not be eligible since you can't change those odds. Neither would PAI GOW POKER and TEXAS HOLD EM since it is too complicated to change all the games. Ideally you would remove some blackjack tables and put in a 3rd craps table.

It would be important to have collateral benefits. If it brought a level of excitement to the casino with people shouting it might bring in more slot players who like the energy. If it sells rooms or food that is also good.

--QUESTIONS--
Would you pay $50 for the right to play for 2 hours? Keep in mind that very large bets would be prohibited. However even at $5 or $10 on long shots like hardways or prop bets in craps with true odds would make it possible to be up several thousand dollars.

Would it work with blackjack? You would have to deal from a single deck so that the player is conscious of a change that favors him since he is paying a fee for the right to play. But you would have to require flat betting so that the card counters don't skin you. If you deal from a shoe, then the rule changes would be subtle (like DAS permitted, dealer hits a soft 17, etc.).

How would you try and save Hooters? They are still losing over $14K per day despite massive cuts in expenses that are leaving the rooms dirtier than ever. The casino revenue was $14.3m in slots, $11.0 million in table games and $0.53 in poker in 2006 (corporate high).

No, I would not try to save Hooters. While I am a big fan of Hooters resturants, I did not like their casino at all. I find the place filthy and don't see where the renovations went.

Now, will someone swoop in and buy Hooters? Quite possible. It's location is relatively okay, but the bargin shopping casino owner who buys the location will definately want to change its name.

Quote: gambler

No, I would not try to save Hooters. While I am a big fan of Hooters resturants, I did not like their casino at all. I find the place filthy and don't see where the renovations went.

Now, will someone swoop in and buy Hooters? Quite possible. It's location is relatively okay, but the bargin shopping casino owner who buys the location will definately want to change its name.

I was less concerned with saving Hooters, per se, as I was in looking to see if my pay for play casino idea makes sense fiscally. If not pay for play then some other experimental technique to galvanize pit revenue. For the four years that they owned the casino table and slot revenue has dropped (with a minor jump in slot revenue in 2008). Most other casinos without baccarat tables are performing similarly.

Year	Table ($mill)	Slots (per machine day)
2006	$11.0	$73
2007	$9.5	$62
2008	$8.9	$67
2009	$6.7	$49

The table revenue is $18K per day. To simply replace you would have to sell 360 passes at $50 each. That would probably be impossible with only 150 positions in the pit. At $100 per pass, you would sell 180 which would work, but it would be much harder to sell.

I have decided it would be easier to sell 40 passes for 2 hours @$50 apiece at three different times during the day. It may be necessary to reduce the price late at night or in the morning. The players would have the 2 hours to play craps, roulette and some blackjack at near zero HA. They would need to show their passes to be included at the reserved tables. The concept would work better if they replaced some of the blackjack tables with a 3rd craps table. Blackjack revenue is severely off in the last 2 years. Bets would be tied to the P/L bet in craps. There would be no odds since you can place several bets at zero HA at one time. Although you are collecting the fee, there should probably be reasonable maximums to reduce variance for the casino.

I figure that you can collect up to $2 million in pay for play fees in a year with three 2 hour sessions per day. Also since men often want to play these games, their wives or girlfriends might play slots and drive up those rates. Since some people will show up that can't get into the session because it is full, they may stay and play slots. You may sell more rooms since people would like to play the late night session.

============

Obviously Hooters thought the location was good. They paid $76 million for the property in put in another $190 million in 2005. They never made a profit. Revenue never went over $66 million and now it is under $47 million. At least two buyers have come and gone.

Tropicana was making about $160 million in 2007 ($60 million gaming revenue), but it went bankrupt the next year. The new owner (a former MGM executive) formed a company and bought it and renovated it at the cost of $120 million. Excalibur and NY/NY are the two most profitable of MGM-MIRAGE casino (as a percentage). Only Circus Circus is cheaper than Excalibur, but CC is the only property losing money.

So, let me modify the question. In this period of plummeting room rates, slot, blackjack, craps and roulette what would you do with a property like this if you were the buyer? The only things going up are baccarat and penny slots. And the penny slot thing is starting to peter out in the oldest gaming areas. Some casinos are over half penny slots now.

The per machine slot revenue is very low compared to anything else on the strip.

Maybe nothing will work. It's too close to the Motel6. They think that they can turn around Tropicana. If the property goes for cheap enough maybe Tropicana will purchase it as an extension of their property. Rio was hiring strippers to swim in their topless pool for a while. Maybe that is the only thing that will work for Hooters.

I think the place needs more sex appeal. For the most part, the place looks like a downtown joint. Given the name, the whole place should be like a party pit, with pretty girls everywhere. However, they just don't have a good location for that. I would consider replacing the whole casino with a bikini bar.

Quote: Wizard

I think the place needs more sex appeal. For the most part, the place looks like a downtown joint. Given the name, the whole place should be like a party pit, with pretty girls everywhere. However, they just don't have a good location for that. I would consider replacing the whole casino with a bikini bar.

So we have a vote for simply dumping the pit and installing a bikini bar. Presumably the lost $18K per day in pit revenue would be replaced by food and drink sales, and increased slot revenue. A non-mathematical solution. The problem is that the casino is still carrying a huge debt load, and without increased revenue is still unstable.

Maybe I will shift my pay for play idea to Terrible's that only has 9 tables. I think they will have to replace blackjack tables with craps tables since the idea doesn't work very well with blackjack.

I think Hooters grossly over-estimated their own brand value from the very beginning, especially in a place like Vegas. Of course, having a crappy casino & hotel only made it worse.

For as much sex as there obviously is in Vegas, it's still (in it's own way), pretty understated. For example, a business traveler can stay on the strip, hang out in a casino with attractive waitresses everywhere, go watch some bikini bull riding, watch a sexy pirate show, find a party pit nearby, etc., and all his expense report (or the credit card statement his significant other looks over) will say is Treasure Island with a dinner at some place called Gilly's.

With Hooters, all the wink-and-nod subtlety goes out the window. Without getting into the merits of the place itself, the name carries a stigma that probably keeps a lot of people from spending their money there.

IMO, they'd be better off as the San Remo (or whatever) and just establish a reputation for having the hottest girls of any affordable casino in town- ie, a taste of downtown without the hassle.

As for the pay-for-play fair odds casino idea, I'm not entirely sure. A player would have to feel like he could make back the entry fee within the amount of time he expected to play there. I'm a low roller, $5 & $10 blackjack if I can find it, so I can go a long time before I lose 40 or 50 bucks on a normal day, even against a house edge inching toward 1%.

I think I'd be sure to include things like full pay VP in there, and definitely some sort of blackjack game, flat bet or CSM or what have you- the rate of mistakes will keep you profitable. For every person who's studied basic strategy & plays it right, there are 10 more who've skimmed it but hate to hit 16s or love to play hunches anyway.

BTW, long time Wizard reader, big fan, love the sites, etc etc.

Two things...

1) Good odds
2) More skin

Right now Hooters has neither. You get more skin at any 'party pit' in the city. From what I've read, their odds suck on most of their games as well (6:5 B/J).

As far as your question regarding pay-to-play...never would work. For ever 1 person that would pay, there would be 20 that don't know odds at all and would be immediately turned off and go to any other place.

Quote: joshv

I think Hooters grossly over-estimated their own brand value from the very beginning, especially in a place like Vegas.

On my recent trip to A.C., I had dinner Friday evening, around 10pm, at Hooters in the Tropicana.

It was the first time I EVER ate at any Hooters.

Quite frankly, I have no idea what the appeal is, or how they stay in business, or why the place was filled to capacity. There were no available tables, but I was able to sit immediately at the counter.

The waitress saw me examining the menu for a long time, so she had to know I've never been to a Hooters before. At any rate, I ordered a Cheeseburger. I was not asked if I wanted fries, but was shocked when it arrived without them. I then ordered fries.

Gang, in my younger days, I worked in all sorts of restaurants. During the busy hours, fries were ALWAYS either ready to be served, or coming out of the frier. So why did it take a full five minutes to get my fries?


So I wonder why they stay in business.

And I wonder how much worse conditions can be at the Hooters casino.


And I am scared to consider that there is (or was) a Hooters airline.

Quote: joshv

I think Hooters grossly over-estimated their own brand value from the very beginning, especially in a place like Vegas. Of course, having a crappy casino & hotel only made it worse.

As for the pay-for-play fair odds casino idea, I'm not entirely sure. A player would have to feel like he could make back the entry fee within the amount of time he expected to play there. I'm a low roller, $5 & $10 blackjack if I can find it, so I can go a long time before I lose 40 or 50 bucks on a normal day, even against a house edge inching toward 1%.

The Hooters restaurants don't do particularly bad in the resort. The hotel is probably about as good as can be expected. They simply hired the San Remo Executives to run the casino. The casino certainly makes more than the San Remo did, but not nearly enough to cover the interest on the huge loans they took out to purchase and renovate the place. I think that Hooters grossly over-estimated how well their own brand would transfer to a casino.

The pay-for-play fair odds casino idea is for the gambler who likes a lot of action. He pays upfront to feel guilt free about throwing lots of bets. Another blogger pointed out that people in Chicago will pay $20/ hour just for the right to play full pay blackjack with a $5 minimum. See I find that dumb, I would just switch games, I am talking about $50 for two hours of being able to throw proposition bets in craps, or play roulette and not have to worry about the HA. They're kitschy theme would be more suited to downtown instead of on the strip.

I think the Hooters would have done better if they bought one of the downtown casinos for a lot less money and renovated it. They would have more walk in traffic. In that sense they screwed up by paying a premium to be near the strip. If they picked up a place like Fitzgerald's they would probably have a profitable operation.

I would not pay a fee for better odds. But I will not pay a fee to do most things. I refuse to buy a Costco membership as well. On the other hand your basic idea and math is sound. It actually mirrors the Costco business model where the annual earnings are usually close to
the total of the annual 'membership fees'. Maybe the Hooters card comps could include lap dances that might attract a certain segment of the population.

Quote: kenarman

I would not pay a fee for better odds. But I will not pay a fee to do most things. I refuse to buy a Costco membership as well. On the other hand your basic idea and math is sound. It actually mirrors the Costco business model where the annual earnings are usually close to
the total of the annual 'membership fees'. Maybe the Hooters card comps could include lap dances that might attract a certain segment of the population.

I've often said there should be nudity in casinos. I don't know if this could pass regulations, but its something that someone in Vegas should try. There isn't much sin in Sin City thats not available in most people's home city.

Quote: DJTeddyBear

On my recent trip to A.C., I had dinner Friday evening, around 10pm, at Hooters in the Tropicana.

It was the first time I EVER ate at any Hooters.

Quite frankly, I have no idea what the appeal is, or how they stay in business, or why the place was filled to capacity. There were no available tables, but I was able to sit immediately at the counter.

The waitress saw me examining the menu for a long time, so she had to know I've never been to a Hooters before. At any rate, I ordered a Cheeseburger. I was not asked if I wanted fries, but was shocked when it arrived without them. I then ordered fries.

Gang, in my younger days, I worked in all sorts of restaurants. During the busy hours, fries were ALWAYS either ready to be served, or coming out of the frier. So why did it take a full five minutes to get my fries?


So I wonder why they stay in business.

And I wonder how much worse conditions can be at the Hooters casino.


And I am scared to consider that there is (or was) a Hooters airline.

Well there was your problem. You went to Hooters and ordered a cheeseburger. Wings, wings and more wings is what you should have gone with. Some people love them, some hate them, but they are different than what you get at most places.

i felt deceived from Hooter's $100 free slot play promotion.

Quote: pacomartin

I started this idea on another thread, but I would like to repost since I've had more time to think about it. Plus I found more operational data on Hooters.

(corporate high).

I just noticed that the new sands hotel in Singapore has a $100 daily fee for locals. This might be the place to see how all the bugs get worked out. I haven't followed the introduction of gambling in Singapore but assume the fee is to try and keep the locals from gambling.

Quote: ruascott

I've often said there should be nudity in casinos. I don't know if this could pass regulations, but its something that someone in Vegas should try. There isn't much sin in Sin City thats not available in most people's home city.

I don't think you'll ever see nudity on the casino floor.

While the casino is restricted to people 21 and older, children are allowed to pass through it acompanied by adults. In 99% of all Vegas hotels, you can't reach half the places without going through the casino first. So that's that.

Maybe at the party pits late at night, say after 10 PM. But then BJ would pay 2 for 3 (and some would consider that a bargain).

Quote: Nareed

BJ would pay 2 for 3 (and some would consider that a bargain).

Wow. That WOULD be a bargain!



Oh, wait. You're talking about the card game....

Quote: ruascott

Two things...

1) Good odds
2) More skin

Right now Hooters has neither. You get more skin at any 'party pit' in the city. From what I've read, their odds suck on most of their games as well (6:5 B/J).

There seems to be a discrepancy here. At the same time bloggers are saying that people are turned off by (6:5 B/J), and in the other breathe they say that only 1 in 20 will go for the pay for play.

Hooters has had a 33% drop in slots over the last 3 years and a 39% drop in table games. This is worst than most places on the strip, but most of the other casinos have had massive drops in slots, and in table games (other than baccarat).

In Vegas 1 in 20 means over 5000 people per day on average. I am trying to appeal to a fraction of 5000 people per day. In particular I am looking at casinos that don't have pedestrian traffic because I know that pay for play is not going to have curb appeal. I know that you can't add pay for play to the Flamingo.

Every single casino in the city now has some kind of sexy blackjack, yet blackjack revenue is down 34% from its peak on the strip just over 2 years ago. While the idea of looking at girls on poles has an obvious marketing appeal, it seems to be only tapping the brakes on a truck that is crashing down the hill.

By all normal rules of supply and demand I can't figure out why dozens of casinos aren't closing. Thousands of rooms in aging casinos all with plunging gaming revenue. Circus Circus, Riviera, Terribles, Sahara, Stratosphere, Hooters, Plaza Hotel & Las Vegas Club (downtown), the aging Fiesta Casinos, and dozens of other places. In January the number of empty hotel rooms midweek was over 50,000.

While Vegas is not going to vanish, there is a core Vegas that doesn't exist anywhere else in the USA, and is not going to be replaced by state sponsored slot clubs or racinos. But there is also a huge part of Vegas in aging casinos (or in some cases in building that were not built for eternity).

There are some people that will stay at the El Cortez downtown (364 rooms) which is the oldest purpose built casino-hotel in Vegas simply because they are the only casino left that has 4 tables with full pay single deck blackjack.

However, since a position (standing or sitting) in a pit is occupied by several people in a night, I don't see how you can have a permanent pay for play casino. The fees will have to pay be too high to replace people who simply lose a little here and a little there. I now believe that the only way it will work is to sell sessions for all or part of the pit.

Although there are millions of people who are math challenged, there seems to be a lot of people that read gambling websites. But I am not sure that it would all be math geeks. There are many people who know there is a difference between "9 to 1" instead of "9 for 1", and that a "yo" bet that pays 18 to 1 instead of 15 to 1 is better. They can weigh the difference between these odds on $5 bets against a fee. As I said earlier this would appeal to players that like lots of action. The casino would make a profit on attracting new customers, not on trying to wring more money out of their current customers.

Quote: Nareed

I don't think you'll ever see nudity on the casino floor.

While the casino is restricted to people 21 and older, children are allowed to pass through it acompanied by adults. In 99% of all Vegas hotels, you can't reach half the places without going through the casino first. So that's that.

Maybe at the party pits late at night, say after 10 PM. But then BJ would pay 2 for 3 (and some would consider that a bargain).

Ha, compared to the price of a gentlemen's club, that would be a bargain!

Maybe I missed it, but how exactly would this play-to-pay work hours wise? I mean people would want to come and go at will, but you couldn't just charge $20 and then play for as long as you want. I guess I'm missing how would do it operationally, unless you had set start/stop times.

The closest comparison to this would be the actual riverboats that use to cruise and/or gambling crusies they had in Florida. People would pay a fee for the boat ride and then would have say 3-4 hours for gambling. People certainly did it, but they liked it a lot more when dockside gambling was allowed.

Full nudity and casinos will probably never be mixed. The separation of full nudity and alcohol has held up in Vegas for decades. Even topless girls and gambling is a very carefully controlled combinations. Rio discontinued hiring strippers for their topless pools since there was just a hint that it might be related to prostitution. I think that casinos are very concerned about prostitutes (or at least public media stories about prostitutes).

Although you read about small towns that have topless coffee shops, and topless donut places, you probably won't see topless girls bringing you drinks at your slot machines.

Maybe I missed it, but how exactly would this play-to-pay work hours wise?

I think you have to sell tickets via a the casino cage or on the website. There is a sign above the craps tables that tells people that they will have to leave the craps game from 6PM to 8PM unless they purchase a ticket. You would sell out a session. The website would be important since people could pre-purchase sessions and go to the casino knowing that their place is reserved. You could tie sales to room promotions. I don't think the sessions could be at prime gaming hours.

The situation worsens for Hooters. Bankruptcy may be near.

Casino	table	slots	room
Hooters	$740	$46.00	$46.00
Stratosphere	$796	$90.29	$43.49

Despite the low revenue Hooters is carrying $165 million in long term debt which is far more than any similar size downtown casino would carry. Hooters has about same number of rooms as Four Queen's.

Hooters casino 27,537 sq. ft.
Four Queen's casino 27,389 sq. ft.

Four Queen's manages to get 1026 slots and a 29 more table games into their casino while Hooters has 621 slots, 24 table games, and 3 poker tables. If you go into the casino you see that Hooter's does not have a very efficient layout with wide walkways on one side.

Hooter's bought their hotel for $74 million in 2006 and dumped well over $100 million into it. Terry Caudill bought Four Queen's for $21 million in 2003. Four Queen's has at least ten million more in revenue than Hooters.

===============================


May. 14, 2010
Copyright © Las Vegas Review-Journal

Hooters Hotel restates worries over cash

By ARNOLD M. KNIGHTLY
LAS VEGAS REVIEW-JOURNAL

Hooters Hotel owners reiterated today they don't believe they have sufficient cash to meet all financial obligations this year as the property continues to miss interest payments while operating at a loss.

The owners did say in a federal filing, however, they have enough money to meet operational obligations, which traditionally include payroll and payments to vendors.

But Barbara Cappaert, a bond analyst with KDP Investment Advisors, disputed that saying in a note to investors the hotel-casino may indeed have trouble sustaining any operations on what she projects to be $5 million in cash flow for the year.

"We reiterate our concern about Hooters Las Vegas as a going concern," Cappaert's note said. "We still believe that even on a land value basis, the bonds are only worth at most 20 cents on the dollar on a present value basis."

Hooters Hotel has missed three consecutive interest payments starting in April 2009 and its debt currently stands at $163 million, a filing today with the Securities and Exchange Commission shows.

The property continued to negotiate with its lenders on a forbearance agreement so banks would not foreclose or force a bankruptcy while owners work to find a remedy to its situation, the filing shows.

"The company has engaged a financial adviser to assist with its evaluation of financial and strategic alternatives," the filing said. "(These) may include a recapitalization, refinancing, restructuring or reorganization of its obligations or a sale of some or all of its business. The company and its advisers are actively working toward such a transaction."

Cappaert said no real progress has been made on any negotiations.

The 696-room hotel-casino on Tropicana Avenue posted a net loss of $3.9 million for the first quarter ended March 31, including a $500,524 operational loss. The losses are a slight improvement from the $4.1 million net loss and $727,000 operational loss for the same time prior year.

Revenues declined 15.4 percent to $11.3 million from $13.3 million in the quarter.

Casino revenues fell 24.1 percent to $4.2 million, hotel revenues dropped 7.8 percent to $3.7 million, and food and beverage dropped 15.8 percent to $4.5 million.

Contact reporter Arnold M. Knightly at aknightly@reviewjournal.com or 702-477-3893.

I think the pay for play thing might be a longshot. It doesn't mesh with the typical hooters crowd - AT ALL. So they would be going after a totally new crowd and abandoning the people that are in there making it profitable now.

I would say make the casino look more modern. Ditch the name. Hire HOT girls to work everywhere and show alot of skin (they can easily do this now due to the job market) and make the entire casino a party pit. Now once they've done that the question is do they go for the 6:5 BJ in the party pit (like NYNY Does) or go 3:2. They would have the research on their typical customer to determine it.

They could put in a no BS nightclub where drinks are cheap no cover charge ect. Their customers are on the lower end of the $$$ spending so they aren't going to want to pay big $$ on drinks and cover for a club. But the club would serve to draw people in get them liquored up and spending $$$.

The topless thing is actually a good idea. It wouldn't be too hard to either make a segregated casino area for the nudity or to just change the whole hotel/casino to 21+ (how many families stay there now?).

Topless won't work with Hooters. It's not the brand. The brand is the tight orange shirts with well-endowed women. Fill the casino with them, party pit it up for the whole casino and young up the place. Put in a good nightclub and the place might do all right on weekends. The problem with hooters is that it can't compete with the strip with the hotel rates being so slow and they are inundated completely with debt meaning that they are stuck with what they have unless they can find more investment (sucker) money.

Hooters should just be done.

Quote: CFTCFT

I think the pay for play thing might be a longshot. It doesn't mesh with the typical hooters crowd - AT ALL. So they would be going after a totally new crowd and abandoning the people that are in there making it profitable now.

I agree that they pay for play is a longshot. I also agree that they would be going after a totally new crowd. The sex and the loud music doesn't seem to want to make large number of gamblers sit at machine.

The $49 per machine at Hooters is far below the downtown average, which in turn is well below the Laughlin machines. The tables are doing better than downtown, but nowhere near the state average.

I don't know if this party pit stuff does more than add a few dollars here and there. It may pull people towards the high House Average games. I don't think it makes a poorly performing casino into a money maker.

Quote: pacomartin

Hooters year end report came in. The casino only made $18 million in 2009. Total revenue is down to $46 million (from $66 million in 2007). They were losing money two years ago so now they may be giving up the ghost.

Chapter Eleven Bankruptcy Petition filed.

LAS VEGAS--(BUSINESS WIRE)--155 East Tropicana LLC, owner of the Hooters Casino Hotel will seek a financial restructuring of its current debt through a petition for reorganization under Chapter 11.

The Company had been in extensive negotiations with its primary bondholder, which purchased approximately 98% of the company’s debt at a substantial discount. The Company no longer believes a pre-negotiated restructuring is possible, and has therefore elected to commence the Chapter 11 process immediately. All hotel and casino operations will continue to operate as usual during the Chapter 11 process, including with respect to employees, customers and vendors.