Billionaire Carl Icahn has acquired the Trump Taj Mahal, exchanging $292 million he’s owed for complete ownership of the casino in a deal that was approved by the New Jersey Casino Control Commission this week.
Icahn says he will invest another $100 million to revitalize the resort and to keep the Atlantic City landmark solvent.
“We believe when you pull into the Taj Mahal, it’s dirty, it’s dated, and it needs to be freshened up,” Trump Entertainment CEO Robert Griffin said of the settlement. “I feel very strongly that the Taj Mahal will do well.”
That will be no easy task, however, as the north end boardwalk gambling venue continues to operate at a loss, including being $8.7 million in the red for the first quarter of 2015. The hotel’s 2,010 rooms were less than 50 percent full during the first three months of the year, a drastically lower rate than that of the other seven casino hotels that averaged occupancy levels of around 70 to 85 percent.
Icahn’t Stand Unions
Icahn is optimistic that he can restore the Taj to its former days of glory. But one key condition the mogul insists on is that Local 54 and the UNITE HERE unions stop their pursuit of having a court mandate Icahn to reinstate benefits for workers that were terminated by Trump Entertainment during bankruptcy proceedings.
On Wednesday, Icahn told reporters he sees the Taj being reestablished much like he did with the Tropicana, the other Atlantic City casino under his ownership.
“Although Local 54 seems fixated at all costs on damaging the Taj, and risking its closure and the loss of almost 3,000 jobs, I am optimistic,” Icahn said.
Icahn also released a letter to Local 54 Taj employees this week that likens the national UNITE HERE organization to a Ponzi scheme that uses dues to enrich the lives of its leadership at a detrimental cost to its members.
“It is an undisputable fact that your union leadership refused to negotiate with the Taj as its losses were mounting and it was pushed into bankruptcy. Your union leadership refused to consider any concession that would have helped keep the Taj afloat, and that is because your jobs do not matter to the union leadership,” Icahn wrote.
The once bustling gambling mecca of the east coast is now home to just eight total casinos, and Icahn now has control of two, or 25 percent of the city’s gaming venues. That means along with Caesars Entertainment, owners of Bally’s, Caesars Atlantic City, and Harrah’s, Icahn has a small monopoly on the town where the game of Monopoly is based.
Thought it’s understandable union workers want and need their health insurance and pension benefits reinstated, their tactics might be going about it in the wrong way. This week, Local 54 delivered a letter to Icahn’s midtown Manhattan office with a list of its demands, along with an apple pie, a dig in response to Icahn saying “apple pie and roses isn’t the way the world works” earlier this year.
We’d suggest he have an intern take a bite first.