Revel AC announced it has reached an agreement with a majority of its lenders to significantly reduce its debt through a debt-for-equity conversion. Revel plans to implement the restructuring through voluntary, prepackaged Chapter 11 cases, and intends to complete the restructuring early this summer.

Revel said as part of the restructuring, certain of Revel’s lenders will provide approximately $250 million in debtor-in-possession financing (DIP), approximately $45 million of which constitutes new money commitments and approximately $205 million of which constitutes prepetition debt.

Revel noted that after undertaking a comprehensive strategic review of restructuring alternatives, the company determined that a prepackaged Chapter 11 would offer the best opportunity for Revel to strengthen its balance sheet and would provide the Company with the financial flexibility and resources to invest in the growth of the business.

“The reduction of debt service expense this agreement facilitates will greatly improve Revel’s cash-flow to better support day-to-day operations,” noted Michael Garrity, Revel’s chief investment officer. “This restructuring positions Revel for long-term success by providing the company with the operational flexibility to invest in the growth of our business.”

Revel’s legal advisor in connection with the restructuring is Kirkland & Ellis. Alvarez & Marsal serves as its restructuring advisor and Moelis & Company serves as its investment banker for the restructuring.

Previously on

WSJ: Revel Casino Hires Restructuring Lawyers and Bankers, Thursday, February 14, 2013