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Penn National Gaming Inc. Message Board

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  • dundarra dundarra Feb 1, 2004 6:16 PM Flag

    Illinois bid

    Didn't mean Shreveport debt has wrecked Penn, obviously not.

    But it did ruin the financial well being of the Shreveport property itself and whoever previously owned it, or owns it now, presumably the bondholders.

    By the way, who does actually own Shreveport? And why doesn't this get settled?

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    • <<By the way, who does actually own Shreveport? And why doesn't this get settled?>>

      Hollywood-Shreveport continues to be owned by Penn's Hollywood-Shreveport subsidiaries. The creditors may still holding out hope of getting paid in full. Realistically, they need to write off a big portion of the debt and/or take an equity position and give Penn a management contract. Foreclosure would result in a fire sale from which they'd get pennies on the dollar. Probably having a hard time finding the right number to write off and the right amount to pay an operator (Penn) to manage the property for them.

      • 1 Reply to mainewatcher2004
      • The creditors of Hollywood=Shreveport exacted a usurius interest rate in the teens. The cash flow generated by operations cannot support the high interest rate. The high interest rate meant high risk. Its time for the bondholders to understand that the operation cannot support the high interest especially on a property that is probably worth less than the value of the bonds. I think the best thing for Penn to do is to spin off Hollywood Shrevesport to Penn shareholders. I think the wisest thing for the bondholders to do as you suggest is to take an equity position and let Penn manage under a contract.

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