A billion-dollar name is joining the New Jersey casino market.
This is according to a news release from Luxor Capital Group LP. Luxor is a hedge fund based in New York and currently owns the Ocean Casino resort. The deal—which has yet to be approved by the New Jersey Division of Gaming Enforcement—is said to be for up to half of the property.
In a news release, Luxor said, “We are extremely excited about the proposed investment by the Ilitch organization, which, if approved, will give Ocean access to growth capital and provide a strategic partner to Luxor. We look forward to continuing to grow Ocean in partnership with the Ilitch organization for years to come.”
The Ocean Casino resort is located on the Atlantic City boardwalk and has been under Luxor’s control since Jan. 2019. It was formerly known as Revel Casino Hotel, which closed in 2014 after opening in 2012. Twice, it has declared Chapter 11 bankruptcy.
However, since Luxor has taken control of the property, they have paid down the remaining debt owed and watched as the Ocean Casino revenue has increased. It ranked third in 2020 in casino revenue, behind Borgata Casino and Hard Rock Casino, and likely has untapped potential in online gambling.
With New Jersey’s online gambling market exploding — the state saw over 100% of an increase in 2020 over 2019 figures, generating more than $970 million — Ocean Casino will likely develop a strategy to tap into that market.
Last year, Ocean Casino saw just over $10 million from online gambling, which ranked last in the New Jersey market. The casino currently has a native application which is hosted by Parx online casino.
Ilitch Holdings, Inc. has made their name in the pizza business by owning Little Caesars Pizza.
This is not their first foray into the casino world, also owning Detroit’s MotorCity Casino. In addition to their pizza and casino businesses, the company also owns MLB’s Detroit Tigers and NHL’s Detroit Red Wings.
While the sale still needs to be approved, that likely is more of a formality at this point, as the Associated Press reports that the company has already applied for interim approval to own part of the casino.
Their presence in the market and how Ocean Casino develops with the roughly 50% stake will be something to watch in 2021.