Sept. 11, 2007 — The Connecticut-based hedge fund Silver Point Capital has filed papers foreclosing on all of Golden Gaming’s land holdings around Great Pond on St. Croix, casting doubt on the future of the several hundred million dollar project.
Paul Golden of Golden Gaming has tried to develop a casino resort on St. Croix’s south shore since 2001. (See "Golden Gaming CEO Remains Steadfast in His Vision.")
On Dec. 1, 2006, Silver Point loaned Golden Gaming $15 million, secured by a mortgage on the casino development company’s land holdings. On Aug. 30 of this year, it filed foreclosure papers on all of Golden Gaming’s land holdings, claiming the lands in payment of the debt.
Silver Point has recently been introduced as a potential rescue vehicle of last resort for Jeffrey Prosser and his bankrupt companies. If that happened, Silver Point would have an ownership stake in Vitelco, the V.I. Daily News and other Prosser properties.
Silver Point has generated considerable controversy over its treatment of employees at companies it acquires. The United Steel Workers of America say that when Silver Point took over the New York-based FiberMark paper mill in 2006, it promptly eliminated pensions, cut health benefits, unilaterally cut worker pay by up to $6 an hour and committed a number of other abuses and violations of labor law. The USW also claims Silver Point stripped the paper mill of $218 million in assets before the year was out.
The National Labor Relations Board has charged Silver Point with violating numerous labor laws. A hearing is scheduled before an administrative judge in Watertown, N.Y., on Sept. 25 to examine the charges.
In a similar vein, an Aug. 30 article in the Buffalo News by Alan Pergament says Silver Point’s takeover of Buffalo’s Channel 7 television station also resulted in immediate, major pay cuts, prompting a mass exodus of staff.
Back Talk Share your reaction to this news with other Source readers. Please include headline, your name and city and state/country or island where you reside.