Trump Taj Mahal Back Out of Bankruptcy with Carl Icahn at the Helm
Posted on: March 1, 2016, 11:37h.
Last updated on: March 1, 2016, 11:49h.
The Trump Taj Mahal is officially out of Chapter 11 bankruptcy and in the clutches of billionaire corporate raider Carl Icahn, as a wholly owned subsidiary of Icahn Enterprises.
And in the very week that New Jersey Governor Chris Christie, having bowed out of the presidential race himself, pledged his support for Donald Trump for the GOP nomination, Icahn’s takeover represents the final chapter in Donald Trump’s Atlantic City and gaming history.
Trump got out of Atlantic City in 2009, selling what was left of the Trump Entertainment casino empire he built in the eighties and nineties to a group of hedge funds and corporate bond holders.
He has had nothing to do with the management of the Taj, or its now defunct sister property, the Trump Plaza, ever since. Nevertheless, the arch negotiator managed to retain a 10 percent stake in Trump Entertainment, in return for allowing the company to retain the Trump brand name.
In 2014, Trump was incensed by what he saw as Trump Entertainment’s mismanagement of the brand and litigated to have his name removed from the casino. But following Icahn’s intervention, he relented, and the name will remain.
Trump Ties Severed
That 10 percent stake is now gone, severing Trump’s last ties with the city. And while his name may still be emblazoned in lights across the front of the building, this is now very much the Carl Icahn show.
The Taj is the second property Icahn now owns in Atlantic City, having also rescued the Tropicana from bankruptcy in 2009.
“The Taj is one of Atlantic City’s signature properties,” Icahn told the Associated Press. “Although both Atlantic City and the Taj have had a few tough years, today marks the beginning of the turnaround,” he added.
“Just a few years ago, Tropicana was in bankruptcy and its fate uncertain, but since emerging in 2010, we have turned that property around and it has become one of Atlantic City’s few success stories. I am confident we can and will do the same for the Taj,” said Icahn.
State of the Union
One group that won’t be applauding, however, is the hotel’s casino workers’ union Unite 54, which has yet to reach a contract agreement with Icahn.
The casino almost closed several times in 2014. Icahn, who had bought most of the Taj’s $286 million debt, said that he was willing to take it over and invest, provided he was granted several concessions by the city. One of those was the right to scrap health insurance and pension benefits for his casino workers.
As such, union demonstrations have become a familiar sight outside the property over the past 18 months.
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