Morgan Stanley, the No. 6 US bank by assets, said it sold its stake in Revel Entertainment Group, the developer of a half-built casino resort in Atlantic City.
Morgan Stanley sold its stake to an investor group led by Kevin DeSanctis, chairman and CEO of Revel Entertainment, according to a filing yesterday with the Securities and Exchange Commission. Morgan Stanley didn't take a pretax loss or gain on the sale, according to the filing.
Morgan Stanley wrote down the value of its stake by about $1.2 billion last year, recognizing a loss of about 98 percent, after deciding to sell the holding.
The SEC asked Morgan Stanley to explain why it waited until last year to report the losses, according to letters released in November.
The sale came on the day Revel said it raised $1.15 billion to restart construction. The resort, located at the northern end of the Atlantic City boardwalk and budgeted at about $2.4 billion, is expected to open in mid-2012, Revel said on that day.
Morgan Stanley told the SEC in letters last year that before its decision to sell the stake, it had consolidated Revel and compared the book value of the investment with undiscounted cash flows to check whether a charge was warranted.
revel entertainment group, atlantic city boardwalk, kevin desanctis, securities and exchange commission, morgan stanley, investor group, us bank, pretax loss, casino resort, stake, securities and exchange, losses, assets, ceo
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