After failing to make an interest payment on a $1.32 billion dollar loan on May 2, Tropicana Entertainment LLC filed for Chapter 11 bankruptcy just three days later. According to sources by missing the payment, Tropicana automatically terminated an agreement with its bondholders. This added to the pressure of the current economic climate forced the company to seek protection for creditors through the bankruptcy filing.
This is just the latest setback for the company since it was purchased by William Yung III just two years ago. The Atlantic City Tropicana lost its operating license late last year when regulators said that it was in violation of state regulations after deep budget cuts when Yung took over the company. Tropican’s new president of only a month, Scott Butera, called the bankruptcy filing an important step back to solid financial ground.