More Trouble for Station Casinos

December 4, 2008

Reuters reports that holders of Station Casinos’ bonds have rejected a proposed debt restructuring:

Station Casinos Inc, which is fending off bankruptcy, said on Wednesday it has a received a letter from a lawyer representing its bondholders saying they view terms in a proposed debt exchange as inadequate.

The statement leaves the casino operator in a precarious position and could result in the company tripping terms in its bank loans, which could lead the company to file for bankruptcy protection, said Barbara Cappaert, analyst at KDP Investment Advisors.

The news comes on the heels of the company’s announcement earlier this week that it was suspending its 401(k) matching contribution. That move has the potential to inflame what is already a tense labor environment for the company thanks to its staunchly open shop policy.

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