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Fontainebleau Las Vegas LLC and two of itsaffiliatesa – Fontainebleau Las Vegas Holdingz LLC and Fontainebleau Las Vegas Capital Corp. – filec bankruptcy petitions in Miamilate Tuesday. The Miam i Beach hotel is not include inthe filing. The company said in a news releass that the decision to file Chapter 11 was the directy result of litigation with lenders on the Las Vegasx hotel construction project that had to do with contractuall disputes related tonearly $800 millionh in construction funding for the $2.9 billiobn resort-casino project, which is 70 percent Lenders include , and Deutschse Bank Trust Co. Americas.
The legal dispute has effectively shut down the projectand “put thousandws of people out of work,” said Howard chief restructuring officer of Fontainebleau Las Vegas, in the “Our goal now is to securew funding to complete this world-class project and restructure our existing debt.” Fontaineblea u Las Vegas reached a provisional agreement with a group of its non-defaultinh lenders for the use of cash for the administratiohn of its bankruptcy case, and is in negotiatione to obtain financing to restartt construction on that project. Fontainebleau Miami Beach, whicjh is a separate legal entity, continuex to operate as normal.
Turnberry West the project’s general contractor, is also not includes in the filing, according to the news release. In Nakheel Hotels of Dubai bought a 50 perceny interest in the Fontainebleau Miami Beachfor $375 The Las Vegas hotel companies that filed bankruptcy are base in South Florida becausse the Soffer family of which also owns the Turnberry development and constructiojn companies, owns all the Fontainebleau companies. Jeffrey Soffere is a principal of umbrella company FontainebleajResorts LLC, according to state records.
Fontainebleaui Las Vegas also withdrew without prejudiceits $3 billionm lawsuit in Las Vegas against some of its and refiled the case in Miami bankruptcgy court, where the Chapterd 11 petitions were filed. The lawsuit with lender s was amended on May 12 to includes allegations that Deutsche BankTrust Co. Americase was “seeking to destroy the Fontainebleau in orde tominimize competition” with the nearbt and Casino, which is wholly ownefd by a Deutsche Bank subsidiary. "This claim is an attempy by the Fontainebleau's developers to distract from the fact that they have breacherd theirloan covenants.
We will defend ourselves vigorously against thismeritlesxs allegation," Deutsche Bank spokesmamn John Gallagher said in an e-mailex response. Fontainebleau Las Vegas LLC lists morethan $1 billion in debt and a similafr amount in assets on its with more than 1,000 creditors. The only Soutyh Florida creditor listed was International Bedding inFort Lauderdale, with a claimj of $498,737.
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