Friday March 13,2015 : ICAHN GAINS CONTROL OF ATLANTIC CITY CASINO (Update)
Bankruptcy court approves the Chapter 11 reorganisation plan for Trump Entertainment Resorts.
Billionaire US investor Carl Icahn has achieved control of Atlantic City land operation Trump Taj Mahal following the approval of a Chapter 11 bankruptcy plan for Trump Entertainment Resorts by a Delaware bankruptcy court this week.
The approval follows a deal struck between Donald Trump and Icahn allowing Trump Entertainment to retain the Trump name in its branding (see previous InfoPowa reports).
Icahn is the primary creditor in Trump Entertainment, the struggling company which owns the Trump Taj Mahal and owes the billionaire investor over $290 million.
The Associated Press news agency reports that the plan approved by Judge Kevin Gross calls for Icahn to exchange his debt for all of the reorganised company’s stock.
Icahn has said he intends to keep open and refurbish the Taj, which employs some 3,000 people.
The proceedings have seen bitter union-investor-operator exchanges and litigation since Trump Entertainment declared bankruptcy last September. It has already seen the closure of subsidiary casino Trump Plaza.
Icahn has committed to provide up to $82.5 million to help the company exit bankruptcy, but the issue is not yet fully resolved; a labour union has a federal appeal in progress regarding the dismissal of Taj Mahal workers whose contracts had expired.
If the appeal is successful, expensive pension and healthcare costs could become payable, enabling Icahn to exercise an option to walk away from the entire deal.