Judge grants Aladdin another extension

Thursday, Oct. 10, 2002 | 11:26 a.m.

The company that operates the $1.2 billion Aladdin hotel-casino on the Las Vegas Strip has been granted a fourth extension of exclusivity to file a reorganization plan in its bankruptcy case.

The extension for Aladdin Gaming LLC gives the hotel-casino the sole right to file a reorganization plan until Dec. 2. The period for the company to solicit votes on the plan also was extended, to Jan. 30.

The extension, approved in U.S. Bankruptcy Court in Las Vegas on Sept. 30, would have expired that date.

Under bankruptcy law, companies are allowed to exclusively draft a reorganization plan before creditors can present their own plans.

Although creditors have the right to seek a motion to shorten the period of exclusivity, attorneys have indicated they don't plan to, indicating they are satisfied with Aladdin's current efforts to bring the hotel-casino out of bankruptcy.

Aladdin LLC has determined that it would sell the property and is currently marketing it through a Los Angeles company. A source has told the Las Vegas Sun that a three-way partnership including Colony Capital LLC, Los Angeles, Pinnacle Entertainment Inc., Glendale, Calif., and Marriott International Inc., Bethesda, Md., is negotiating to buy the property.

Colony Capital has been identified as a "stalking horse" bidder that would offer to buy the Aladdin and would be paid a breakup fee if another offer is accepted for the 2,567-room hotel-casino.

The exclusivity extension was the fourth in the Aladdin case, which began when the company filed for Chapter 11 bankruptcy protection in September 2001. In previous extension filings, the company said it needed extra time because of the size and complexity of the case.