Trump's casinos get 1 more week in debt talks

ATLANTIC CITY - Donald Trump's embattled casino company yesterday got a one-week extension, to Feb. 11, to keep talking with its lenders and bondholders.

Trump Entertainment Resorts Inc., which owns and operates the Trump Taj Mahal, Trump Plaza and Trump Marina casinos here, was given a similar extension two weeks ago to continue talks after it missed a monthly bond payment of $53.1 million due Dec. 1.

As a condition of a forbearance agreement reached after the 30-day grace period expired Dec. 31, the company also agreed to restructure about $1.25 billion of debt.

"The significance of [the extension] is that we have made enough progress to continue with the discussions to try and move them along even further," Trump Entertainment chief executive officer Mark Juliano said last night.

Trump's casino company is no stranger to Bankruptcy Court, and the decision prevented or delayed its fourth trip there.

After emerging from its last bankruptcy restructuring in May 2005, the company has struggled to maintain market share in Atlantic City.

To raise cash, the company put its casinos up for sale in 2007. Two takeover offers failed, and last year, Coastal Development L.L.C., of New York, announced that it had agreed to buy the Trump Marina for $270 million. The sale is expected to close in May, but Wall Street analysts say the tight credit markets could delay the closing.

Trump shares closed at 24 cents, down 2.08 percent.

Barbara J. Cappaert, a high-yield bond analyst with KDP Investment Advisors Inc., of Montpelier, Vt., and someone who has covered Trump for more than a decade, said Trump's problems came at a terrible time for the gaming industry.

"All the [gaming] markets are having issues right now. It's a difficult climate to operate," she said. "But that being said, these companies are still very profitable.

"They all still are making money," she said. "But it's how much is being expended on interest and debt payments, and how much of that they can handle, that's of concern."

Cappaert added: "Chapter 11 is not the end of the world for Trump. It's about how much ongoing cash flow the company has coming in, what capital structure makes sense for it given the near-term concerns, and how much additional funds it needs to continue to operate."

Like virtually every gambling hall here, all three casinos bearing Trump's famous name reported decreased revenue last year. Pennsylvania slots competition has attracted many former Atlantic City regulars, and the bad economy has intensified pressures on casino operators to streamline costs and shed workers.

At least a few loyal Trump Taj Mahal customers have been lamenting the possibility of their favorite casino going through bankruptcy - again.

Among them was Trenton native Jesse Stills, who now lives in Kansas City, Mo. Stills, 40, came for a four-day visit last weekend with his girlfriend, and the duo played the slot machines and stayed at the Taj hotel.

"I like the man," Stills said of Trump. "But with the economy, you can't be surprised.

"With him, it's not like the first time," he said.

Trump has company. Colony Capital L.L.C., of Los Angeles - the parent of the company that owns the Atlantic City Hilton and Resorts casinos here - was also in negotiations to restructure its debt.

Last week, the lender for Resorts threatened to take over the casino after it failed to make three consecutive monthly payments.

Earlier this week, the state-appointed trustee in charge of selling the Tropicana announced that the Boardwalk casino would be sold in a bankruptcy auction after he was unable to reach a deal with a potential bidder.