NEW YORK (Reuters) - Investor Carl Icahn has teamed up with Beal Bank to present a restructuring plan for bankrupt Trump Entertainment Resorts TRMPQ.PK in an effort to beat out a rival plan proposed by a group of bondholders.
Icahn said on Friday that he bought the majority of the first lien bank debt in the casino operator and would partner with Beal Bank and its affiliate Beal Bank Nevada to bring the plan to fruition.
The partnership is an effort to “allay concerns and criticism over the ability of the Beal Plan to move forward,” according to a statement from Icahn’s office.
“We reached out to Mr. Icahn to capitalize on his extensive experience both in the gaming industry and in turning around troubled companies,” Beal Bank’s Andrew Beal said in the statement.
Beal Bank and its affiliate have claims of about $485 million in the bankruptcy case.
A representative for Icahn said he was not disclosing how much he paid for the debt.
Icahn is also involved in the restructuring of another Atlantic City casino, the Tropicana Atlantic City Casino and Resort, as well as the Fontainebleau Las Vegas.
In a statement, Icahn said a “conservative” approach was needed to ensure the company, which operates three Atlantic City casinos, successfully emerges from bankruptcy.
He blasted a rival plan proposed by bondholders and backed by the casino’s founder Donald Trump, saying it “may well turn into a round-trip ticket to bankruptcy court.”
In an email statement, Trump said, “I haven’t run the casinos in years and am not involved in this transaction.”
Trump Entertainment filed for bankruptcy protection earlier this year, hobbled by the drop in gaming revenue in Atlantic City as well as growing regional competition.
In November, all three of the casinos owned by Trump Entertainment posted a double-digit drop in gaming revenue compared to a year ago, according to the New Jersey Casino Control Commission.
It is the third trip to bankruptcy court for Trump Entertainment and the second one this decade.
Reporting by Deepa Seetharaman, additional reporting by Karen Jacobs; Editing by Steve Orlofsky, Phil Berlowitz