Trump Entertainment Resorts
Encyclopedia
Trump Entertainment Resorts, Inc. is a holding company
that owns and manages two casino
s/hotel
s in Atlantic City, New Jersey
, United States
. Formerly known as Trump Hotels & Casino Resorts, it was founded by Donald J. Trump
, who was Chairman of the Board of Directors until his resignation in 2009. Bob Griffin is currently Director and Chief Executive Officer
. The organization runs two properties: Trump Taj Mahal and Trump Plaza
. Together the properties have 6,600 slot machines, nearly 350 gaming tables and over 3,600 hotel rooms. It sold the Trump Marina to Landry's Restaurants
, which also operates the Golden Nugget
in Las Vegas. Trump is not on the group's board, but was given stock in the company for its use of his name and likeness.
and Harrah's approached him to manage construction of a Holiday Inn Casino-Hotel. It opened in May 1984 and two years later Trump bought out Holiday Inn's shares in the property and renamed it the Trump Plaza Hotel and Casino.
In 1985, Trump purchased the nearly-complete Atlantic City Hilton hotel and casino property at the Atlantic marina from Hilton Hotels
for $325 million. The hotel chain sold the property after its application for a gaming license was turned down by the CCC. Trump originally opened the property as Trump's Castle Hotel Casino, and later renamed it the Trump Marina.
In 1988, Trump purchased the unfinished Taj Mahal property from Resorts International for $230 million after negotiations with Merv Griffin
in which the two men divided the assets of the failing company. The casino, at the time the largest in Atlantic City, would eventually cost almost $1 billion by the time it opened in 1990. Trump completed the project using junk bonds
, a decision that hurt the company afterward as the gaming industry struggled in a recession and interest rates became unmanageable.
In 1995 Trump created Trump Hotels and Casino Resorts (DJT) and began issuing public shares in his Atlantic City holdings.
In 2004, Trump Hotels & Casino Resorts explored various options for restructuring its debt, amid speculation that it might file for bankruptcy
. A possible arrangement with Credit Suisse First Boston
was not completed because the bondholders rejected it.
On October 21, 2004, the company announced a preliminary agreement with its investors. Trump, who has been the majority owner, would reduce his stock ownership from 56 percent to 27 percent. Bondholders would surrender some of their debt in exchange for stock. On October 27, the company announced that Morgan Stanley
would be the joint lead arranger for a financing of $500 million financing as part of the restructuring plan. On November 21, the company filed for bankruptcy. Trump said the filing was "really just a technical thing" as the best way to implement the restructuring plan. The plan was submitted to the Bankruptcy Court on December 16, 2004.
After the 2004 bankruptcy filing, the company changed its name from Trump Hotels & Casino Resorts to Trump Entertainment Resorts.
On May 18, 2007, the company announced that it was in the preliminary stages of negotiating a buyout
with several public and private firms. On July 2, 2007 Trump Entertainment Resorts announced that they could not make a deal with any company that they were in talks with and decided to take itself off the market. The company planned to lay off employees in order to cut costs.
Trump initially made an agreement with banker/high-stakes poker player Andrew Beal
, owner of Beal Bank
, which held $500 million in the group's debt, to take over the resorts. However, citing concerns about the bank's experience with gaming, he dropped them in favor of the hedge fund Avenue Capital Management, a plan favored by other bond-holders. Beal then partnered with investor, Carl Icahn
, who had worked on restructuring another Atlantic City casino, the Tropicana. In court, Trump argued that he would fight the Icahn/Beal team if they sought to use his name and likeness on the group's properties. Instead he signed an agreement with Avenue Capital in which he would receive 5% stock in the reorganized company and another 5% in exchange for the use of his name and likeness in perpetuity.
Judith H. Wizmur, Chief Judge of the United States Bankruptcy Court for the District of New Jersey, eventually sided with the Trump/Avenue partnership, favored by bond holders who believed that Trump's brand would result in a stronger company after reorganization.
Holding company
A holding company is a company or firm that owns other companies' outstanding stock. It usually refers to a company which does not produce goods or services itself; rather, its purpose is to own shares of other companies. Holding companies allow the reduction of risk for the owners and can allow...
that owns and manages two casino
Casino
In modern English, a casino is a facility which houses and accommodates certain types of gambling activities. Casinos are most commonly built near or combined with hotels, restaurants, retail shopping, cruise ships or other tourist attractions...
s/hotel
Hotel
A hotel is an establishment that provides paid lodging on a short-term basis. The provision of basic accommodation, in times past, consisting only of a room with a bed, a cupboard, a small table and a washstand has largely been replaced by rooms with modern facilities, including en-suite bathrooms...
s in Atlantic City, New Jersey
Atlantic City, New Jersey
Atlantic City is a city in Atlantic County, New Jersey, United States, and a nationally renowned resort city for gambling, shopping and fine dining. The city also served as the inspiration for the American version of the board game Monopoly. Atlantic City is located on Absecon Island on the coast...
, United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
. Formerly known as Trump Hotels & Casino Resorts, it was founded by Donald J. Trump
Donald Trump
Donald John Trump, Sr. is an American business magnate, television personality and author. He is the chairman and president of The Trump Organization and the founder of Trump Entertainment Resorts. Trump's extravagant lifestyle, outspoken manner and role on the NBC reality show The Apprentice have...
, who was Chairman of the Board of Directors until his resignation in 2009. Bob Griffin is currently Director and Chief Executive Officer
Chief executive officer
A chief executive officer , managing director , Executive Director for non-profit organizations, or chief executive is the highest-ranking corporate officer or administrator in charge of total management of an organization...
. The organization runs two properties: Trump Taj Mahal and Trump Plaza
Trump Plaza (Atlantic City)
Trump Plaza is a hotel and casino located on the Boardwalk in Atlantic City, New Jersey. Designed by architect Martin Stern, Jr., it was opened in 1984 and is one of two casinos owned by Trump Entertainment Resorts...
. Together the properties have 6,600 slot machines, nearly 350 gaming tables and over 3,600 hotel rooms. It sold the Trump Marina to Landry's Restaurants
Landry's Restaurants
-External links:*...
, which also operates the Golden Nugget
Golden Nugget Las Vegas
The Golden Nugget Las Vegas is a luxury casino-hotel located in Las Vegas, Nevada on the Fremont Street Experience. The property is owned and operated by Landry's Restaurants....
in Las Vegas. Trump is not on the group's board, but was given stock in the company for its use of his name and likeness.
History
Trump began purchasing properties along the Atlantic City boardwalk in the early 1980s and received a gaming license from New Jersey's Casino Control Commission (CCC) on March 15, 1982. He had planned to build his own casino on the boardwalk, but was stalled on the project when Mike Rose, then CEO of Holiday InnHoliday Inn
Holiday Inn is a brand of hotels, formally a economy motel chain, forming part of the British InterContinental Hotels Group . It is one of the world's largest hotel chains with 238,440 bedrooms and 1,301 hotels globally. There are currently 5 hotels in the pipeline...
and Harrah's approached him to manage construction of a Holiday Inn Casino-Hotel. It opened in May 1984 and two years later Trump bought out Holiday Inn's shares in the property and renamed it the Trump Plaza Hotel and Casino.
In 1985, Trump purchased the nearly-complete Atlantic City Hilton hotel and casino property at the Atlantic marina from Hilton Hotels
Hilton Hotels
Hilton Hotels & Resorts is an international chain of full-service hotels and resorts founded by Conrad Hilton and now owned by Hilton Worldwide. Hilton hotels are either owned by, managed by, or franchised to independent operators by Hilton Worldwide. Hilton Hotels became the first coast-to-coast...
for $325 million. The hotel chain sold the property after its application for a gaming license was turned down by the CCC. Trump originally opened the property as Trump's Castle Hotel Casino, and later renamed it the Trump Marina.
In 1988, Trump purchased the unfinished Taj Mahal property from Resorts International for $230 million after negotiations with Merv Griffin
Merv Griffin
Mervyn Edward "Merv" Griffin, Jr. was an American television host, musician, actor, and media mogul. He began his career as a radio and big band singer who went on to appear in movies and on Broadway. From 1965 to 1986 Griffin hosted his own talk show, The Merv Griffin Show on Group W Broadcasting...
in which the two men divided the assets of the failing company. The casino, at the time the largest in Atlantic City, would eventually cost almost $1 billion by the time it opened in 1990. Trump completed the project using junk bonds
High-yield debt
In finance, a high-yield bond is a bond that is rated below investment grade...
, a decision that hurt the company afterward as the gaming industry struggled in a recession and interest rates became unmanageable.
In 1995 Trump created Trump Hotels and Casino Resorts (DJT) and began issuing public shares in his Atlantic City holdings.
Financial Troubles
Trump Entertainment Resorts has filed for corporate bankruptcy three times, in 1991, following construction of the $1 billion Trump Taj Mahal and in 2004 and 2009.In 2004, Trump Hotels & Casino Resorts explored various options for restructuring its debt, amid speculation that it might file for bankruptcy
Bankruptcy
Bankruptcy is a legal status of an insolvent person or an organisation, that is, one that cannot repay the debts owed to creditors. In most jurisdictions bankruptcy is imposed by a court order, often initiated by the debtor....
. A possible arrangement with Credit Suisse First Boston
Credit Suisse First Boston
Credit Suisse First Boston was the former name of the banking firm Credit Suisse.-History:In 1978, Credit Suisse and First Boston Corporation formed a London-based 50-50 investment banking joint venture called the Financière Crédit Suisse-First Boston...
was not completed because the bondholders rejected it.
On October 21, 2004, the company announced a preliminary agreement with its investors. Trump, who has been the majority owner, would reduce his stock ownership from 56 percent to 27 percent. Bondholders would surrender some of their debt in exchange for stock. On October 27, the company announced that Morgan Stanley
Morgan Stanley
Morgan Stanley is a global financial services firm headquartered in New York City serving a diversified group of corporations, governments, financial institutions, and individuals. Morgan Stanley also operates in 36 countries around the world, with over 600 offices and a workforce of over 60,000....
would be the joint lead arranger for a financing of $500 million financing as part of the restructuring plan. On November 21, the company filed for bankruptcy. Trump said the filing was "really just a technical thing" as the best way to implement the restructuring plan. The plan was submitted to the Bankruptcy Court on December 16, 2004.
After the 2004 bankruptcy filing, the company changed its name from Trump Hotels & Casino Resorts to Trump Entertainment Resorts.
On May 18, 2007, the company announced that it was in the preliminary stages of negotiating a buyout
Buyout
A buyout, in finance, is an investment transaction by which the ownership equity of a company, or a majority share of the stock of the company is acquired. The acquiror thereby "buys out" control of the target company....
with several public and private firms. On July 2, 2007 Trump Entertainment Resorts announced that they could not make a deal with any company that they were in talks with and decided to take itself off the market. The company planned to lay off employees in order to cut costs.
2009 Bankruptcy and Restructuring
The casino group filed for bankruptcy for the third time in February 2009 owing $1.2 billion. Two sets of debt holders eventually proposed reorganization plans for the group in U.S. bankruptcy court.Trump initially made an agreement with banker/high-stakes poker player Andrew Beal
Andrew Beal
D. Andrew "Andy" Beal is a Dallas, Texas-based billionaire businessman who was born and raised in Lansing, Michigan. He made his fortune in banking and real estate and is the founder and chairman of Beal Bank and Beal Aerospace Technologies. Beal is also known for his high-stakes poker games and...
, owner of Beal Bank
Beal Bank
Beal Bank is a Texas-based bank founded in 1988 by Andy Beal. Headquartered in Dallas, Texas, Beal Bank has deposit branches in more than 30 major metropolitan areas across the United States....
, which held $500 million in the group's debt, to take over the resorts. However, citing concerns about the bank's experience with gaming, he dropped them in favor of the hedge fund Avenue Capital Management, a plan favored by other bond-holders. Beal then partnered with investor, Carl Icahn
Carl Icahn
Carl Celian Icahn is an American business magnate and investor.-Biography:Icahn was raised in Far Rockaway, Queens, New York City, where he attended Far Rockaway High School. His father was a cantor, his mother was a schoolteacher...
, who had worked on restructuring another Atlantic City casino, the Tropicana. In court, Trump argued that he would fight the Icahn/Beal team if they sought to use his name and likeness on the group's properties. Instead he signed an agreement with Avenue Capital in which he would receive 5% stock in the reorganized company and another 5% in exchange for the use of his name and likeness in perpetuity.
Judith H. Wizmur, Chief Judge of the United States Bankruptcy Court for the District of New Jersey, eventually sided with the Trump/Avenue partnership, favored by bond holders who believed that Trump's brand would result in a stronger company after reorganization.
Former properties
- Harrah's at Trump Plaza in Atlantic City, New Jersey (formerly a 50/50 partnership with Harrah's) now wholly owned as the Trump Plaza.
- Trump 29 in Coachella, CaliforniaCoachella, CaliforniaCoachella is a city in Riverside County, California; it is the easternmost city in the region collectively known as the Coachella Valley...
(formerly a 50/50 partnership with the Twenty-Nine Palms Band of Mission Indians of CaliforniaTwenty-Nine Palms Band of Mission Indians of CaliforniaThe Twenty-Nine Palms Band of Mission Indians of California is a federally recognized tribe of Mission Indians, located in the City of Twentynine Palms, San Bernardino, California...
) now Spotlight 29 CasinoSpotlight 29 CasinoThe Spotlight 29 Casino is an Native American gambling enterprise, of the Twenty-Nine Palms Band of Mission Indians, located in Coachella, California, USA. The casino has 2,000 slot machines, 30 table games, and an 11 table poker room. The casino also has a 2,200 seat showroom.-History:On January...
. - Trump Casino in Gary, IndianaGary, IndianaGary is a city in Lake County, Indiana, United States. The city is in the southeastern portion of the Chicago metropolitan area and is 25 miles from downtown Chicago. The population is 80,294 at the 2010 census, making it the seventh-largest city in the state. It borders Lake Michigan and is known...
now the Majestic Star II. - Trump Marina (Previously Trump Castle) in Atlantic City, New Jersey now the second incarnation of the Golden Nugget Atlantic CityGolden Nugget Atlantic CityThe Golden Nugget Atlantic City was a casino from 1980 to 1987 in Atlantic City, New Jersey. It is currently the Atlantic City Hilton.It was built in 1980 by a partnership of Golden Nugget Companies and Michael R. Milken for $140 million....
brand. - Steel Pier, now owned by Steel Pier Associates.