Trump casinos to file for bankruptcy protection; plan would strip Trump's majority stake - NewsOn6.com - Tulsa, OK - News, Weather, Video and Sports - KOTV.com |

Trump casinos to file for bankruptcy protection; plan would strip Trump's majority stake

Updated:
ATLANTIC CITY, N.J. (AP) _ You could call it Trump: The Art of the (Bankruptcy Restructuring) Deal.

Donald Trump's casino businesses, which have failed to share in his highly publicized successes in other realms in recent years, are being restructured under a bankruptcy protection plan that would strip The Donald of his majority stake.

Under the plan, announced late Monday, Trump Hotels & Casino Resorts plans to enter Chapter 11 bankruptcy next month, emerging within a year.

DLJ Merchant Banking Partners, an arm of Credit Suisse First Boston, and Trump would invest $400 million to help the company pay down its $1.8 billion in debt and cut interest payments in half.

Trump, the chairman, chief executive and largest shareholder, would see his stake in the company shrink from 56 percent to 25 percent, with Credit Suisse owning more than two-thirds of the company.

Trump himself would contribute nearly $71 million, $55 million of which would be in the form of a co-investment with Credit Suisse and $15.9 million of which would come from his Trump Casino Holdings notes.

Trump would also give up trademark rights to his name and likeness for use in connection with casino operations.

``I look forward to our recapitalized company being a major player in the evolving gaming industry,'' Trump said in a statement.

Trump emerged in the 1980s as New York's hottest developers, attaching his name to buildings, Atlantic City casinos and best-selling books, notably ``Trump: The Art of the Deal.'' By the early 1990s, though, the headlines were more about financial troubles and his breakup with his first wife, Ivana.

In 1992, the three casinos he then owned _ the Taj Mahal, Castle and Plaza, all in Atlantic City _ ended up in Chapter 11, burdened by more than $1 billion in debt and hurt by the 1990-91 recession. Trump later regained control of the casinos.

But he climbed back from the brink of personal bankruptcy and chronicled his return to billionaire status in the 1997 book ``Trump: The Art of the Comeback.''

Earlier this year, Trump conquered the world of television with the smash reality show ``The Apprentice,'' and his signature statement, ``You're fired,'' became a national catch phrase. The new attention put him back on the best-seller list this spring with ``Trump: How to Get Rich.''

Last month, when his hotel-casino business reported a $17.6 million second-quarter loss, Trump blamed it on high gas prices and ``other inflationary pressures'' that have left his customers with less money to gamble at the beginning of the summer season.

The company's $220 million yearly interest payments have been a drain, while a lack of cash has left Trump's three New Jersey casinos vulnerable to new competition, such as the Borgata Hotel Casino & Spa, the $1.1 billion gaming hall that has been siphoning gamblers since it opened a year ago.

The bankruptcy protection plan is expected to cut Trump Hotels' annual interest expenses by more than $110 million.

Trump Hotels had $1.16 billion in 2003 revenues and has about 8,500 employees.

The company, through its subsidiaries, owns and operates four properties under the Trump brand name. They are Trump Taj Mahal Casino Resort, Trump Plaza Hotel and Casino and Trump Marina Hotel Casino, all in Atlantic City; and Trump Casino Hotel, a riverboat in Gary, Ind. The company also manages Trump 29 Casino, an Indian-owned facility near Palm Springs, Calif.
Powered by Frankly
News On 6
303 N. Boston Ave.
Tulsa, OK 74103
Newson6.com is proud to provide Oklahomans with timely and relevant news and information, sharing the stories, pictures and loves of Oklahomans across our great state.
All content © Copyright 2000 - 2017 KOTV. Oklahoma Traveler™ is a registered trademark of Griffin Communications. All Rights Reserved.
For more information on this site, please read our Privacy Policy, and Terms of Service, and Ad Choices.