Arizona Charlie’s future is nearly settled

John Wilen

Friday, June 26, 1998 | 11:38 a.m.

Bruce Becker keeps Arizona Charlie's, Carl Icahn makes $10 million and Station Casinos walks away under a plan approved Thursday by U.S. Bankruptcy Court Judge Linda Riegle.

In her ruling -- known technically as confirmation -- Riegle approved an agreement reached last week between Becker and Icahn, who has been trying to take control of the 260-room Decatur Ave. resort since it entered bankruptcy in November.

Under that agreement, Becker will pay Icahn and other owners of Arizona Charlie's mortgage debt $61.6 million. Other creditors will receive about $7.1 million. In return, Becker will keep Arizona Charlie's.

Icahn, who owns 51 percent of the resort's debt, will get about $31.6 million, plus $1.5 million in other fees. The billionaire bought Arizona Charlie's notes last summer for 72 cents to 78 cents on the dollar, meaning he will make about $10 million from the transaction, sources said.

Thursday's ruling was the final condition Becker needed to meet to receive a $92 million loan from United Healthcare Financial Services of Los Angeles. Becker expects that loan to close next week, at which time all creditors will be paid, and the resort will leave bankruptcy. The loan will also be used to expand Arizona Charlie's, Becker said.

At Thurday's hearing, attorneys announced that Station Casinos -- which owns a minority share of Arizona Charlie's debt -- had dropped its bid for the resort. Late last week, Becker and Icahn accepted a Station offer to buy Icahn's position in the Becker-Icahn agreement.

But Station backed out of that offer earlier this week when the company buying Station, Texas-based Crescent Real Estate Equities Inc., balked at the idea of buying mortgage notes it was likely to hold for only a short period of time, said sources familiar with the negotiations.

Other issues between Station and Icahn, including the payment of trustee fees, were resolved before Crescent nixed the deal, the sources said.

Station officials did not attend the hearing and a spokesman declined comment.