New Jersey’s Atlantic City, once a thriving haven for gamblers and casinos, appears to be continuing its downward trend.
The Trump Taj Mahal, a 2,248-room, 24-year-old hotel-casino situated on Atlantic City’s boardwalk, may file for protection under Chapter 11 of the bankruptcy law in the next few days, according to the New York Post. The casino has broken some of its loan agreements and has failed to reach an out-of-court solution with its creditors, sources said.
Some of those involved with the negotiations had hoped that Carl Icahn, who owns a significant part of the Taj Mahal’s debt, would agree to a debt-for-equity deal, the Post reported. This would have likely been enough to keep the hotel-casino out of Chapter 11. This appears not to be happening.
Though the casino – and operating company Trump Entertainment Resorts – bear Donald Trump’s name, the mogul retains less than a 10 percent stake, according to the news source. Marc Lasry’s Avenue Capital led a group of hedge funds that bought the company out of a previous bankruptcy in 2009.
Angry about the state of disrepair into which the Trump Plaza and the Trump Taj Mahal have fallen, Trump recently filed a lawsuit against the company, alleging that it tarnishes his personal brand and confuses customers, according to The Associated Press.
“Since Mr. Trump left Atlantic City many years ago, the license entities have allowed the casino properties to fall into an utter state of disrepair and have otherwise failed to operate and manage the casino properties in accordance with the high standards of quality and luxury required under the license agreement,” Trump wrote in his lawsuit, according to the news source. “The Trump name … has become synonymous with the highest levels of quality, luxury, prestige and success.”
It remains to be seen if bankruptcy proceedings for the Trump Taj Mahal will be any more palatable to The Donald.
Taj Mahal isn’t the only casino in Atlantic City to face bankruptcy, recently I wrote an article discussing the downturn of the $2.2 billion casino, Revel:
Atlantic City’s Revel To File For Bankruptcy Again
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