Bidder agrees to buy Casino Miami Jai-Alai for $155 million
03/25/2014 7:03 PM
03/25/2014 9:25 PM
The main lender behind Miami Jai-Alai’s recent multimillion-dollar expansion and foray into casino gaming agreed at an auction Tuesday to pay $155 million to buy the historic fronton and casino.
A federal judge on Wednesday will decide whether to approve the bid entered by ABC Funding. The equity fund beat out bids from casino operators Mohegan Sun and Penn National Gaming as well as Chicago private-equity firm Z Capital, according to Luis Salazar, an attorney who represented Casino Miami Jai-Alai at Tuesday’s auction at the Biltmore in Coral Gables.
“There was very spirited bidding by all parties,” Salazar said.
The auction came after the casino’s parent company, Florida Gaming Corp., filed for Chapter 11 bankruptcy protection in August.
The filing came after Florida Gaming had agreed to sell Casino Miami Jai-Alai for $130 million, including $15 million in obligations, to a New York-based investment firm that owns casinos in Panama and Curacao. An investment bank later valued the casino as being worth $180 million. The move also came after ABC Funding sued the casino, alleging nonpayment of debt.
The 1926 facility, located at 3500 NW 37th Ave., was once a center of Miami nightlife. But as the fast-paced sport of jai-alai fell out of popularity, so did the fronton’s bottom line.
After the state legalized gambling in 2011, Florida Gaming took out an $87 million loan from ABC Funding to add a 60,000-square-foot casino with 1,000 slot machines, an expanded poker room, video blackjack and more, as well as concert and restaurant facilities. Opened in January 2012, the casino proved to be a boon for business, while jai-alai continued to be a money-vacuum.
Financial statements filed in court showed the fronton’s slot machines deliver $1.1 million in cash to the operation every week, while a top executive testified that running jai-alai matches brings a net loss of about $1 million a year.
Silvermark LLC, the New York group that originally tried to buy Casino Miami Jai-Alai, would be owed a $4 million “breakup” fee from ABC Funding if terms of Tuesday’s auction are approved.
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