Business Essentials for Professionals


Trump Taj Mahal casino in Atlantic City to be Closed Down by Icahn

Trump Taj Mahal casino in Atlantic City to be Closed Down by Icahn
The Trump Taj Mahal is about to go the way of the Colossus of Rhodes, which was billed as the “eighth wonder of the world” when it opened a quarter-century ago. The Trump Taj Mahal casino, owned by Carl Icahn, on the glitziest stretch of the Jersey shore was announced to be closed own after multiple bankruptcies and the longest union strike in Atlantic City casino history.
This announcement was recently made by billionaire Icahn’s investor company.
The struggling New Jersey beach resort would be dealt another blow by the closure of the casino. This casino has been plagued by a strike by its unionized workers over wages and health insurance costs. While just one of the four casinos that had been shut down since 2014, there are eight other functional casinos there which would all be closed down.
"Currently the Taj is losing multimillions a month, and now with this strike, we see no path to profitability," Tony Rodio, chief executive of Tropicana Entertainment Inc, said in a statement.
“Icahn Enterprises [which owns Tropicana Entertainment] saved the Tropicana [another Atlantic City casino owned by the company], and to date has lost almost $100m trying to save the Taj when no other party including the prior equity owners who put it into its recent bankruptcy were willing to invest even one dollar to save it,” Rodio said. He was referring to Carl Icahn, the current owner of the Trump Taj Mahal.
Rodio, whose company is controlled by Icahn said that the casinos "cannot just allow the Taj to continue burning through tens of millions of dollars when the union has single handedly blocked any path to profitability" and this was decided for by the board of the Taj and Icahn Enterprises.
He said that Icahn's company has lost nearly $100 million "trying to save the Taj" and added that the company intends to send required layoff notices to workers before this weekend.
Donald Trump, who lost his stake in the casino during its bankruptcy, was once the owner of it. Icahn had purchased the final shares of the resort casino from Trump in February.
The closure was termed as "petty" and an attempt to break their labor strike by Bob McDevitt, president of Unite Here Local 54, which represents about 1,100 workers at the casino who will lose their jobs.
"The great dealmaker would rather burn the Trump Taj Mahal down just so he can control the ashes. In the end he'll have to live with what he's done to working people in Atlantic City," McDevitt said in a statement.
"The Boardwalk is littered with empty monuments to his greed," he said.
Atlantic City has until November to devise a fiscal recovery plan or else face possible state takeover as it is struggling to pay its bills even as it was once the U.S. East Coast's only casino gambling site.
Due to competing casinos opening in neighboring states, its gambling industry lost value and its property tax base eroded.
It is "unfortunate and disappointing" that no resolution has been found to keep the Taj Mahal open, Atlantic City Mayor Don Guardian said in a statement.
"Atlantic City has been resilient for over 160 years and we will continue to do so, as we rise to meet any challenge ahead of us," Guardian said.

( & 

Christopher J. Mitchell

Markets | Companies | M&A | Innovation | People | Management | Lifestyle | World | Misc