March 9, 2010 / 12:14 AM / 10 years ago

Tropicana casinos exit bankruptcy under Icahn deal

NEW YORK (Reuters) - U.S. casino operator Tropicana Entertainment Inc TRPET.UL on Monday emerged from bankruptcy protection under a $200 million deal backed by billionaire investor Carl Icahn.

During the bankruptcy process Tropicana, which runs the Tropicana Atlantic City Casino & Resort, cut its debt by about $2.5 billion and renewed its gaming licenses in five states, including Nevada and New Jersey.

“Tropicana Entertainment is the first major company in the gaming industry to successfully complete a Chapter 11 reorganization necessitated in part by the combined effects of collapsed commercial credit markets and associated declines in the U.S. consumer economy,” Icahn said in a statement on Monday.

Affiliates of Icahn own about 47 percent of the company and are also lenders on its bankruptcy exit financing facility.

Tropicana, which filed for bankruptcy protection in May 2008, owns nine properties including the Tropicana Casino & Resort on the Las Vegas strip.

The deal marks a return of Icahn to Atlantic City, who once owned the old Sands Casino Hotel.

Atlantic City, along with Las Vegas, has been struggling to attract revenues amid the recession and increasing competition. Revenues for Atlantic City’s 11 casinos have been plunging for three years, hurt by regional competition and weak consumer spending.

Tropicana is Icahn’s second casino deal this year, having bought the partially built Fontainebleau in Las Vegas this January for $156.5 million.

He is also fighting to play a bigger role in Atlantic City, battling against celebrity developer Donald Trump for control of Trump Entertainment Resorts TRMPQ.PK in a separate bankruptcy case in New Jersey.

The case is in re: Tropicana Casino and Resort, U.S. Bankruptcy Court, District of New Jersey, No. 09-20711.

Reporting by Emily Chasan, Editing by Phil Berlowitz

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