Barrick Gaming secures financing for acquisitions

Thursday, Feb. 26, 2004 | 11:03 a.m.

The start-up company buying four downtown Las Vegas casinos from gaming pioneer Jackie Gaughan recently secured financing for the roughly $82 million deal, a company executive said today.

Barrick Gaming Corp. announced plans in December 2002 to purchase the Gold Spike, Western Hotel, Las Vegas Club and Plaza hotel-casinos in addition to two downtown motels and various parcels of vacant and developed land downtown.

Barrick's senior lender is Aereal Bank, an institution based in Frankfurt, Germany, that will provide $45 million in loans, said Stephen Crystal, president and co-founder of Barrick Gaming.

The company also will receive $30 million in "mezzanine financing" from Fortress, a New York City company that operates an equity fund called the Drawbridge Opportunity Fund. Mezzanine financing is a cross between stock and bond financing, Crystal said, and is sometimes used by startup companies.

A second New York City entity called Concord Investment Partners, a private real estate investment group, will fund the balance of the equity, he said. Concord invests in real estate projects in Times Square and saw a parallel between redevelopment in Times Square and downtown Las Vegas, he said.

Barrick Gaming executives are scheduled to appear before the state Gaming Control Board March 3 for license approval.