International edition
June 24, 2021

Altough the firm is in talks about a possible sale

Trump casinos granted licenses for next 5 years daily

(US).- They could be sold any day now, but the three casinos bearing Donald Trump’;s name have brand new five-year licenses. The state Casino Control Commission approved new licenses for the Trump Plaza Hotel and Casino, Trump Marina Hotel Casino and Trump Taj Mahal Casino Resort.

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hey acted despite skepticism of rosy financial projections the casinos’ parent company, Trump Entertainment Resorts, laid out for the next three years. James Fogarty, a deputy state attorney general, noted that just five months into the company’s 36-month projections, it is already falling behind its own targets.

Trump Entertainment is in talks with a group led by former Atlantic City casino executive Dennis Gomes and real estate developer Morris Bailey about a possible sale of the casinos.

"There is no doubt that the three casino licensees have significantly improved since they last appeared before this commission," said Robert Pickus, Trump executive vice president. "Trump Plaza, Trump Taj Mahal and Trump Marina now have resources they had lacked for many years that will enable them to compete."

Despite the approval, the commission imposed conditions on the new license, including monthly financial reports that Trump Entertainment has to submit comparing its financial projections with actual performance. It also said the company had to notify the commission of any new refinancing of its us$ 1.4 billion in debt.

Fogarty noted that Trump’s 2007 estimate calls for us$ 292 million in net revenue, and us$ 66.9 million in the first quarter, but the company’s actual first-quarter revenue was us$ 61.5 million. He also questioned the company’s goal to increase gross operating profit margins from 16.8 percent in 2006 to 25.2 percent by 2009 - an increase of about 50 percent.

’’I wish I could share that level of confidence,’’ commission Chairwoman Linda Kassekert said. "They will face new and increased competition from other jurisdictions and the potential effects of the partial smoking ban. There is going to be a new CEO at the helm of the company, and there apparently are discussions under way which could lead to the sale of the company.’’

Mark Juliano, who was elevated to interim CEO of Trump Entertainment on Monday following the departure of James Perry, said he had no update on the status of talks between Trump and the Gomes group about a possible sale. But he assured the commission that Trump Entertainment has the resources and the fiscal discipline to succeed over the next five years.

He noted the company has invested more than us$ 225 million in its properties in the past two years, renovating all its hotel rooms and continuing work on an 800-room expansion of the Taj Mahal that’s due to open in the third quarter of 2008 - work that takes care of details large and small. "It’s safe to say that the purple and lavender at the Taj Mahal were banished forever," he said.

Should the casinos be sold, the licenses would remain in effect, but the new owners would have to qualify as casino operators, commission spokesman Daniel Heneghan said.

In a research report Wednesday, KeyBanc Capital Markets analysts Dennis Forst and Charles Suh wrote that it appears unlikely one suitor would purchase all three Trump casinos, each of which require significant capital expenditures for renovation.

"The only scenario we see that might make sense is if the assets were sold piecemeal to other gaming operators looking for a major market presence," they wrote.

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