Amex may delist Santa Fe Gaming

Friday, Nov. 27, 1998 | 11:45 a.m.

Financially ailing Santa Fe Gaming Corp. said today the American Stock Exchange may delist its shares.

The Amex halted trading of Santa Fe's common and preferred shares Wednesday and didn't reopen trading today. Santa Fe common last traded at 62.5 cents, while its preferred was last quoted at 25 cents.

The company also said today its Pioneer Finance Corp. subsidiary has agreed to file a pre-packaged bankruptcy reorganization plan and that its Pioneer Hotel Inc. unit and Santa Fe itself may also file for bankruptcy protection.

The company owns the Santa Fe hotel-casino in Northwest Las Vegas and the Pioneer hotel-casino in Laughlin, as well as acreage in Henderson and on the Las Vegas Strip.

Santa Fe announced Wednesday that Pioneer Finance had failed to gain approval from holders of $60 million of first-mortgage notes for an exchange offer. The subsidiary had sought to exchange the existing notes, due next Tuesday, for a new issue payable in 2006.

Alternatively, Pioneer had asked note holders to consent to a reorganization plan. It said holders of $45.8 million, or 76.4 percent, of the notes approved the consent solicitation.

As a result, Pioneer said, it will buy, on a pro rata basis, $6.5 million of the existing 13.5 percent notes from consenting holders and about $1 million of the notes on a pro rata basis from non-consenting holders.

It said the indenture covering the notes will be amended to reflect proposals contained in the consent solicitation and that Santa Fe will pledge the stock of other subsidiaries as collateral for the notes. Santa Fe will also grant liens on "substantially all of its other assets," the company said.

In return, the company said, the consenting holders have agreed to defer moves to force Santa Fe into involuntary bankruptcy proceedings until Dec. 15, 2000, due to Pioneer's failure to pay interest and principal on the notes.

Santa Fe said the consenting holders have agreed to accept the reorganization plan, which is subject to approval of the bankruptcy court "and potentially of other creditors."