Casino News Today

ATLANTIC CITY, N.J. - The FBI and New Jersey State Police say they have arrested a man they believe is the “Commuter Bandit” wanted for robbing 17 banks in Philadelphia and New York.

Thirty-nine-year-old Anthony Boyd of Queens, N.Y., was arrested Wednesday night at the Borgata Hotel, Casino & Spa in Atlantic City. Authorities say Boyd escaped from a Bronx halfway house in December. He was finishing a 10-year sentence for bank robbery.

Boyd’s last suspected bank job occurred Tuesday in Manhattan. The FBI says law enforcement officials received a tip after surveillance video was broadcast on television Wednesday and tracked Boyd to the Borgata.

He had an initial court appearance in Camden on Thursday and is being held in a federal detention facility in Philadelphia. It was not known if he had retained an attorney.

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The news sent MGM (MGM:

MGM Mirage

MGM 2.59, -0.50, -16.2%) shares tumbling 14% in morning trading Friday.

CityCenter, a 67-acre site consisting of hotel-condominiums, a casino and a 500,000-square-foot shopping center, has hired law firm Dewey & LeBoeuf to prepare for a potential bankruptcy filing, according to the New York Times, citing unidentified people briefed on the matter.

The Times reported that MGM Mirage and Dubai World will likely fail to make a $220 million debt payment due Friday, leading to the project’s possible bankruptcy filing within days.

MGM’s bonds are rated below investment grade and have traded at a deep discount to their par value due to fears that it will default or file for bankruptcy. The price of the 5.875% coupon due in 2014 fell Friday to 34 cents on the dollar from 37 cents, according to junk-bond specialist KDP Investment Advisors.

The price reached a low of 30 cents at the beginning of the month, half of what the bond were worth at the beginning of the year.

Dubai World has signaled it won’t provide its half of Friday’s payment, while MGM Mirage struggles to persuade its unwilling lenders to help it finance the project alone, The Wall Street Journal reported. The casino company faces a cash crunch as it tries to meet obligations on more than $13 billion in debt. It narrowly averted defaulting on loans last week and warned that it could default by mid-May, the Journal reported.

Missing the payment Friday could halt work on the project within days, idling 8,500 construction jobs, the Journal said, citing a person familiar with the situation. A delayed opening could also affect 12,000 workers who are to staff the complex, the paper said.

CityCenter, once touted as the largest privately funded development in history, was slated to open later this year after several reductions in its planned scale and scope. MGM has been scrambling to find the money to finish the job, recently using up its last available credit facility and selling off its Treasure Island casino hotel at the heart of the Las Vegas Strip.

Dubai World, saying it’s significantly concerned about MGM Mirage’s survival, sued the gambling giant Monday, charging a breach of contract over the massive CityCenter joint venture, after MGM said in a disclosure that “there’s substantial doubt about our ability to continue as a going concern.”

MGM Mirage sold half its interest in CityCenter to Dubai World, the investment arm of the United Arab Emirates government, in late 2007. At the time, Las Vegas was booming. Under terms of that deal, Dubai World also began acquiring shares of MGM Mirage and currently owns about 9.4% of it.

But the global economic crisis has since had a deep impact on Sin City’s fortunes, with visitor and spending rates dropping by double digits. That has squeezed the once-robust cash flows of casino operators and left them vulnerable to the risk of default on various debt loads used to fund rapid expansion.

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