Resorts International Files for Bankruptcy Under Chapter 11 : Casinos: The move was expected by many analysts. Merv Griffin’s ailing company will continue operations during its reorganization.

Resorts International, the financially troubled casino company owned by former talk show host Merv Griffin, filed for bankruptcy protection Friday as part of its continuing effort to dig out from under its heavy debts.

Resorts said it filed a voluntary Chapter 11 petition at the same time it submitted a reorganization plan with the federal bankruptcy court in Camden, N.J. The Chapter 11 petition, which had been expected, allows Resorts to continue operating under the protection of the bankruptcy court while it reorganizes.

Resorts International owns casino hotels and real estate in Atlantic City, N.J., and the Bahamas. The company fell on hard times in the past year after Griffin bought the firm from real estate developer Donald J. Trump. Griffin financed the deal with $325 million in high-yield junk bonds.

Those bonds, on top of the $600 million in long-term debt already on the company’s books, proved to be a crushing financial burden that Resorts could not sustain. Last August, the company suspended payments on all of its long-term debt, which had been costing about $130 million a year.

Resorts’ reorganization plan, first unveiled last month, calls for Griffin to reduce his majority ownership in exchange for a reduction in the face value of the company’s long-term debt to $400 million from more than $900 million. Griffin also will contribute $30 million in cash to the company.

If approved, the reorganization would give the bondholders, who range from retirees to institutional investors, a 78% ownership in the company. Griffin would retain 22% of the stock and stay on as chairman. He would be able to appoint a majority of the company’s new six-person board.

Two bondholder committees gave their preliminary approval to the reorganization last month, but the proposal still needs the blessing of a majority of the bondholders whose holdings total at least two-thirds of the bonds’ face value. The reorganization must also be approved by the New Jersey Casino Control Commission and the government of the Bahamas.

Wilbur Ross, investment adviser to the secured bondholders, said the reorganization probably will be approved but stopped short of saying it is a sure thing, noting that “it’s a finicky world and funny things do happen.”

There are some bondholders who don’t like the plan, Ross said, but “I don’t think there are enough” to vote down the reorganization.

Resorts is trying to restore stability to its finances by February, when it is scheduled to undergo license renewal hearings for its Atlantic City casino. Company officials said previously that its gambling license would be harder to renew if the company had to solve its problems in bankruptcy court.

But company officials now say that New Jersey casino regulators should look kindly on the financial reorganization if it is being carried out smoothly. The reorganization is not expected to be completed before next spring. Regulators in New Jersey could not be reached for comment.

Resorts’ casino in Atlantic City is undergoing an expensive renovation as part of the rebuilding plans. Once one of the most popular casinos in town, Resorts is now in the bottom half of the class among the 11 gambling houses there.

The Resorts casino had gaming revenue of only $215 million in the first 11 months of 1989, nearly 6% less than it had during the same period in 1988, according to Atlantic City Action, a casino industry newsletter. Only three other casinos in town--the Sands, Claridge and Bally’s Grand--had lower revenues, the newsletter said.