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Fitzgeralds' Value Cut by $10 million

The parent company of the Fitzgeralds hotel-casino in downtown Las Vegas reported a $10 million charge to write down the value of the property after spinning it off to a different company subsidiary in December, the company reported in its fourth quarter earnings statement Tuesday.

Last year, casino holding company Majestic Star Casino LLC received regulatory approval to spin off the property to Barden Development Inc., the parent company of Majestic Star Casino LLC. Majestic Star directly owns a riverboat casino of the same name in Gary, Ind. and owns two other Fitzgeralds casinos in Tunica, Miss. and Black Hawk, Colo. through a subsidiary, Majestic Investor Holdings LLC.

Majestic Star officials last year said spinning off the Las Vegas property would free it from the restrictive covenants on bank and bond loans and would allow the company to more easily pursue upgrades and other capital spending projects downtown.

Including the $10 million loss on the Las Vegas property and a $32 million loss for paying down debt, the Majestic Star parent company reported a net loss of $43.9 million for the three months ended Dec. 31 compared to a loss of $2 million for the same period a year ago. Losses for the full year of 2003 and 2002 were $43.9 million compared to $1.3 million.

Copyright © Las Vegas Sun. Inc. Republished with permission.

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