Friday, May 29, 2009 | 12:53 p.m.
Wrestling with more than $5 billion of debt and weak cash flow, Station Casinos Inc. of Las Vegas today said it expects key creditors to give it more time to reach an agreement on a financial restructuring.
Spokeswoman Lori Nelson said Station expects to receive an extension on a forbearance agreement with creditors that expires today. Under the forbearance, the creditors agree not to take action against Station for it defaulting on debt obligations.
The company expects to receive a signed forbearance extension shortly, Nelson said. It was unknown how long the latest extension would last.
This would be the fourth forbearance extension for Station. The last one was reached May 15.
Station has been negotiating with lenders on a prepackaged bankruptcy reorganization that would keep current owners the Fertitta family and Colony Capital in control of the firm. Bondholders would make concessions while the owners would inject $244 million into the company, now struggling under a debt load of $5.74 billion.
The recession has reduced revenue and cash flow at Station, hurting its ability to make debt payments.
In the first quarter of 2009, gross revenue of $307.6 million was down from $378.8 million in the 2008 quarter.
Operating income and earnings from joint ventures fell from $68.5 million in the 2008 quarter to $29.4 million in this year's quarter.