Apprentice TV Show Star Trump Casinos
The "B" word will continue to haunt the Trump casinos for a while longer. And we're not talking about the Borgata. After six months operating under Chapter 11 protection, Donald Trump's debt-ridden casino empire was supposed to shed the "bankrupt" label on Thursday.
However, Trump Hotels & Casino Resorts Inc. announced that it is postponing its exit from bankruptcy until May 20 to give it more time to finish the final paperwork for the financing and other agreements.
"A lot of it is just logistics," Trump Hotels President Scott C. Butera said. "We want to make sure it is done as perfectly as it should be."
The bankruptcy plan includes a sweeping corporate and financial restructuring that will place the casinos under the control of a new company called Trump Entertainment Resorts Inc. The Trump properties have stagnated for years, losing business to the billion-dollar Borgata Hotel Casino & Spa and other rivals.
Trump's reorganized company will chop $400 million from its suffocating $1.8 billion debt load and lower its interest payments by about $100 million annually. It will also have access to a new $500 million line of credit for upgrades to its three aging Atlantic City gaming halls.
Although the Trump name will stay on the casinos, bondholders will take majority control of the company from Trump as part of the bankruptcy plan. Trump will continue as company chairman and the largest individual shareholder, but his ownership stake will be reduced from 56 percent to 30 percent.
While Atlantic City remains the company's main focus, the restructuring plan also allows Trump to explore opportunities in emerging gaming markets. Among other possibilities, Trump may bid on one of the slot parlor franchises in Philadelphia when Pennsylvania introduces casino-style gambling in 2006 or 2007.
The Philadelphia Daily News reported in Thursday's editions that Trump is looking at the old Budd Co. manufacturing plant in the city's Nicetown section as a possible site for a slot parlor. Last month, Pennsylvania Gov. Ed Rendell encouraged Trump to bid on a slot gaming license.
Butera said the company is considering a number of possible sites in Philadelphia, but would neither confirm nor deny that the Budd property is among them.
"We haven't disclosed any of that information. That was more rumor than anything else," he said of the Daily News report.
Trump's expansion plans in Philadelphia and Atlantic City will have to wait until after the company formally emerges from bankruptcy. The cash-starved company, which has not turned a profit since it went public in 1995, filed for Chapter 11 bankruptcy protection last November.
Once it completes its restructuring, the company plans to build a new hotel tower at Trump Taj Mahal Casino Resort and refurbish Trump Plaza Hotel and Casino and Trump Marina Hotel Casino.
Trump Hotels suffered another money-losing quarter in the first three months of 2005. It reported a net loss of $45.4 million, or $1.52 a share, compared to a loss of $48.9 million, or $1.63 a share, in the first quarter of 2004.
Net revenues for the quarter fell at all three of Trump's Atlantic City casinos. Cash flow, another key measure of financial strength, was down at Trump Taj Mahal and Trump Plaza, but rose 6.1 percent at Trump Marina during the quarter.
Shares of Trump Hotels dropped 7 cents to $1.63 Thursday in over-the-counter trading.
However, Trump Hotels & Casino Resorts Inc. announced that it is postponing its exit from bankruptcy until May 20 to give it more time to finish the final paperwork for the financing and other agreements.
"A lot of it is just logistics," Trump Hotels President Scott C. Butera said. "We want to make sure it is done as perfectly as it should be."
The bankruptcy plan includes a sweeping corporate and financial restructuring that will place the casinos under the control of a new company called Trump Entertainment Resorts Inc. The Trump properties have stagnated for years, losing business to the billion-dollar Borgata Hotel Casino & Spa and other rivals.
Trump's reorganized company will chop $400 million from its suffocating $1.8 billion debt load and lower its interest payments by about $100 million annually. It will also have access to a new $500 million line of credit for upgrades to its three aging Atlantic City gaming halls.
Although the Trump name will stay on the casinos, bondholders will take majority control of the company from Trump as part of the bankruptcy plan. Trump will continue as company chairman and the largest individual shareholder, but his ownership stake will be reduced from 56 percent to 30 percent.
While Atlantic City remains the company's main focus, the restructuring plan also allows Trump to explore opportunities in emerging gaming markets. Among other possibilities, Trump may bid on one of the slot parlor franchises in Philadelphia when Pennsylvania introduces casino-style gambling in 2006 or 2007.
The Philadelphia Daily News reported in Thursday's editions that Trump is looking at the old Budd Co. manufacturing plant in the city's Nicetown section as a possible site for a slot parlor. Last month, Pennsylvania Gov. Ed Rendell encouraged Trump to bid on a slot gaming license.
Butera said the company is considering a number of possible sites in Philadelphia, but would neither confirm nor deny that the Budd property is among them.
"We haven't disclosed any of that information. That was more rumor than anything else," he said of the Daily News report.
Trump's expansion plans in Philadelphia and Atlantic City will have to wait until after the company formally emerges from bankruptcy. The cash-starved company, which has not turned a profit since it went public in 1995, filed for Chapter 11 bankruptcy protection last November.
Once it completes its restructuring, the company plans to build a new hotel tower at Trump Taj Mahal Casino Resort and refurbish Trump Plaza Hotel and Casino and Trump Marina Hotel Casino.
Trump Hotels suffered another money-losing quarter in the first three months of 2005. It reported a net loss of $45.4 million, or $1.52 a share, compared to a loss of $48.9 million, or $1.63 a share, in the first quarter of 2004.
Net revenues for the quarter fell at all three of Trump's Atlantic City casinos. Cash flow, another key measure of financial strength, was down at Trump Taj Mahal and Trump Plaza, but rose 6.1 percent at Trump Marina during the quarter.
Shares of Trump Hotels dropped 7 cents to $1.63 Thursday in over-the-counter trading.
posted by kevin at 9:10 AM
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