AC: Taj Closing
"we spend half the year learning about the natives" Exactly, when I did attended, that's all they taught. Obviously I missed writing classes.Quote: ahiromuI grew up just outside of Seattle, I tell people I am from there because you can't expect people to know the suburbs. How the fuck did I not learn about this in school? Like, seriously, we spend half the year learning about the natives but we have to skip "recent" history because we run out of time? History education needs a serious overhaul.
The sad thing about a sign being posted up like that in AC would be that the last person out of the city will probably have their lights shut off because of lack of payment.
PS. Have you seen the TV series The Killing?
Quote: JackStraw8004I fully expect Union 54 to roll over and do what's necessary to keep the Taj open. The workers themselves will force the Union to make the concessions. A job is better than unemployment checks with no benefits at all.
Why do you think that the Taj is any different than the other recently-closed AC casinos in this respect? Most pressingly, why is it different than the Plaza?
Quote: rdw4potusWhy do you think that the Taj is any different than the other recently-closed AC casinos in this respect? Most pressingly, why is it different than the Plaza?
Because this is the only one they even left the possibility of staying open with concessions on the table. Their volume along with a refinance of debt and employee cost reductions would allow them to possibly make it.
Quote: BozBecause this is the only one they even left the possibility of staying open with concessions on the table. Their volume along with a refinance of debt and employee cost reductions would allow them to possibly make it.
Don't forget Carl Icahn is playing 2 hands at this table (Trop & Trump)
He & Loveman seem hellbent to reduce capacity, at all cost.
They conspired on the Atlantic Club deal & remember this - April 2013:
"Investor Carl Icahn, who owns the mortgage on Trump Plaza in Atlantic City, says he won't let a proposed sale for $20 million go through.
“It’s as black and white as it can be: They can’t sell that casino without our consent. It’s not going for anywhere close to $20 million,” Icahn said.
Icahn’s opposition is blocking the Meruelo Group, of Downey, Calif., from completing its $20 million purchase of Trump Plaza. The deal, announced in February, would be the lowest sale price ever for an Atlantic City casino.
Icahn said he privately told Trump Entertainment Resorts Inc., Trump Plaza’s parent company, about three months ago that he would not approve the sale, but the deal was announced anyway.
“They didn’t take no for an answer,” he said."
Quote: rdw4potusWhy do you think that the Taj is any different than the other recently-closed AC casinos in this respect? Most pressingly, why is it different than the Plaza?
Exactly. The Taj and Plaza are one company, if
they couldn't do it for the Plaza, the Taj doesn't
have a chance. This is a desperate move, if
we knew how much in debt they were, we'd be
saying 'oh my dear god'..
Nice post. I did forget.Quote: 7star4nowDon't forget Carl Icahn is playing 2 hands at this table (Trop & Trump)
He & Loveman seem hellbent to reduce capacity, at all cost.
They conspired on the Atlantic Club deal & remember this - April 2013:
"Investor Carl Icahn, who owns the mortgage on Trump Plaza in Atlantic City, says he won't let a proposed sale for $20 million go through.
“It’s as black and white as it can be: They can’t sell that casino without our consent. It’s not going for anywhere close to $20 million,” Icahn said.
Icahn’s opposition is blocking the Meruelo Group, of Downey, Calif., from completing its $20 million purchase of Trump Plaza. The deal, announced in February, would be the lowest sale price ever for an Atlantic City casino.
Icahn said he privately told Trump Entertainment Resorts Inc., Trump Plaza’s parent company, about three months ago that he would not approve the sale, but the deal was announced anyway.
“They didn’t take no for an answer,” he said."
Quote: JackStraw8004This isn't like owing a big law firm or company who supplies power money.
right. Defaulting on the power bill has much more dire consequences than defaulting on the wonton purchases.
Quote: AxelWolfPS. Have you seen the TV series The Killing?
I haven't, some good location-specific material?
I'm far from the biggest fan of unionization, but regardless what we've been told, I'm under the distinct impression Taj's problems are much deeper than being able to save a few bucks on fringe benefits.
Seattle location. Fairly good.Quote: ahiromuI haven't, some good location-specific material?
I'm far from the biggest fan of unionization, but regardless what we've been told, I'm under the distinct impression Taj's problems are much deeper than being able to save a few bucks on fringe benefits.
Quote: ahiromuI haven't, some good location-specific material?
I'm far from the biggest fan of unionization, but regardless what we've been told, I'm under the distinct impression Taj's problems are much deeper than being able to save a few bucks on fringe benefits.
I remember hearing that when the taj first opened, they were under so much debt, they had to make 1M/day on average in order to keep the place running - and then multiple bankruptcies happened
http://www.youtube.com/watch?v=GGWjUYWatTo
The problem is customer service. It doesn't exist. People from other parts of the country don't want to fly to AC to receive the east coast treatment and attitude.
Everyone there acts miserable, and cynical. It's expensive, and you even have to pay outrageous fees just to park in a dangerous parking lot. They can't attract the conventions for the same reason. LV understands customer service, AC does not. The only people that gamble in AC are basically the people that live there, or very close to the area.
In order for AC casinos to survive, they need to fire most of the employees and fly in people from Las Vegas and elsewhere to fill the positions. They also need to clean the place up. It's filthy. The rooms are nasty with holes in the walls, and pealing wallpaper in even the nicer rooms.
-Keyser
Some might suggest that would provide an opportunity to simultaneously improve the standards of both places.Quote: Keyserand fly in people from Las Vegas and elsewhere to fill the positions.
But I didn't say it, that's just what someone might say, so all of y'all with Culinary Local 226 cards on the Strip don't line up to go spitting in my coffee now.
Even if the Union caves, won't a decent % of Taj's most loyal customers be running for the hills - after the recent closures?
Perception of AC customers has flipped . In the past many thought your future free rooms & comps would be carried over, as the new owner took over.
Thought was casinos never lose $ , never close & I'll use my comps & nites at one of their other casinos.
Well you could still use your showboat comps @ CZR, your Trump Plaza rating @ Taj (temporarily) & AC club didn't have the magnitude of players to make that be a difference.
Revel closing, however, left many good players holding the bag.
If they are not whales, many lost a lot or- played a lot @RV, & now have no points & will have trouble getting rooms with the reduced inventory.
I think Taj will be losing players much faster than it thinks it could possibly pick up new players as a result of the closures.
If you were a decent Revel player, would you jump from the frying pan into the fire @ Taj? Showboat players will stick w/CZR.
"(Reuters) - Trump Entertainment Resorts received U.S. Bankruptcy Court approval on Wednesday for an agreement that gives it 30 days to craft a cost-cutting turnaround plan to save its Taj Mahal casino-hotel from liquidation.
A lawyer for Trump Entertainment said after the hearing in Wilmington, Delaware, that the company could present a plan to end operations.
"It could be a liquidating plan, but we hope not," said Kristopher Hansen, an attorney with Stroock & Stroock & Lavan who represents Trump Entertainment.
Hansen told Gross that the company could not find financing to help keep it operating in bankruptcy, leaving the company dependent on billionaire investor Carl Icahn, who has liens on the company's cash.
Icahn consented to giving the company 30 days to present a plan of reorganization. The plan must be confirmed by Gross in 105 days, or late November.
Icahn is owed about $286 million."
http://in.reuters.com/article/2014/09/10/trump-bankruptcy-casinos-idINL1N0RB0VB20140910
The plot thickens.
I was wondering why Icahn was going along with blowing up his Trump interests- after living with the declines all these years - just as there is less competition from Showboat, Revel & AC club.
Google:
Several Investors Circling Atlantic City's Revel
Quote: KeyserThe problem with the Taj is common to all of the AC casinos.
The problem is customer service. It doesn't exist. People from other parts of the country don't want to fly to AC to receive the east coast treatment and attitude.
Everyone there acts miserable, and cynical. It's expensive, and you even have to pay outrageous fees just to park in a dangerous parking lot. They can't attract the conventions for the same reason. LV understands customer service, AC does not. The only people that gamble in AC are basically the people that live there, or very close to the area.
In order for AC casinos to survive, they need to fire most of the employees and fly in people from Las Vegas and elsewhere to fill the positions. They also need to clean the place up. It's filthy. The rooms are nasty with holes in the walls, and pealing wallpaper in even the nicer rooms.
-Keyser
Friendliest staff I've ever come across were at the Cromwell…so nice and courteous
http://www.bizjournals.com/philadelphia/news/2014/09/12/trump-taj-mahal-officially-warns-3-100-employees.html
Quote: JackStraw8004Trump has a negative name in Atlantic City. He repeatedly filed bankruptcy and now they want to let him back in. He won't do anything for the Plaza or Taj. I think more people dislike Donald Trump than like him. I guess AC is so desperate that they will let anyone buy the the properties. If all these properties reopen the same conditions that caused them to close still exists. You need new imaginative owners. With Trump it's the "sos" that has been there for 30 years.
"Glenn Straub" the high bidder on Revel, may make Donald look like a subtle, clever businessman by comparison.
Ego's must be fed.
Ironically, as was once pointed out in a documentary of Howard Hughes... if they both simply invested their inheritances, at the time, in a simple passbook savings acct & kept their mouths shut- they'd be twice as wealthy via meager compound interest
Taj Mahal has some potential. But again who wants to take a risk in a still declining market?
If the Taj closes A.C. will end 2014 with almost 7200 fewer casino/hotel rooms, all on the boardwalk then at the start of the year.
There will be a lot of unhappy people who used to get room comps that will disappear. Many boardwalk gamblers will undoubtedly head over to the marina district. Time will tell just how all this plays out.
Quote: dave12038457IMHO Trump is just pulling another publicity stunt. Atlantic City has been very much in the news as of late. He just wants to ride on the coattails of the story. To rehab Trump Marina into The Golden Nugget cost something like $150 million. I would find it hard to believe Trump Plaza could be redone for any less. And just who would sink that kind of money into a failed A.C. casino?
Taj Mahal has some potential. But again who wants to take a risk in a still declining market?
If the Taj closes A.C. will end 2014 with almost 7200 fewer casino/hotel rooms, all on the boardwalk then at the start of the year.
There will be a lot of unhappy people who used to get room comps that will disappear. Many boardwalk gamblers will undoubtedly head over to the marina district. Time will tell just how all this plays out.
I don't know who's more revolting, Trump's PR stunt - or the spoon fed media -complicit with him in toying with the emotions of thousands of unemployed workers
Quote: 7star4nowI don't know who's more revolting, Trump's PR stunt - or the spoon fed media -complicit with him in toying with the emotions of thousands of unemployed workers
Isn't about time he starts talking about running for President again to keep his name in the news?
"Carl Icahn holds all the cards at the Trump casinos in Atlantic City, and the question is, will he hold ‘em or will he fold ‘em?
As a secured lender who’s owed $285 million plus interest, he’s in a prime position in the Trump Entertainment Resorts Inc. Chapter 11 case..."
"Mr. Icahn isn’t saying, but Boardwalk observers and industry analysts believe there’s a chance Trump Taj Majal is worth saving. Minus the need to pay $38 million in annual debt service, minus the corporate overhead of Trump Entertainment Resorts Inc. and without the drag of ailing Atlantic City sister Trump Plaza, the Taj Mahal could turn a profit."
"Trump Entertainment attorney Kristopher Hansen pointed out that there’s also the matter of the secured debt to be resolved, even if the union does an about-face. Carrying costs on the debt are about $38 million annually. That’s money that has been going into Mr. Icahn’s pocket, until recently, ....
In the Trump Entertainment case, no one’s even talking about a sale. Mr. Icahn can use Chapter 11 to get out from under a lot of obligations, then seize what’s left, including the Trump Taj Mahal, if he wants it..."
"His companies also control Tropicana Casino & Resort Atlantic City, a competing Boardwalk property. In the last Trump Entertainment Chapter 11 case, that was used against him by opponents who predicted he’d shut the Trump casinos to funnel business to the Tropicana....Mr. Icahn bought the Trump Entertainment debt at a discount during the previous Chapter 11 proceeding, . Mr. Icahn quickly recouped $125 million of his investment from a capital-raising effort by the bondholders. Court records indicate that Trump Entertainment paid down tens of millions of dollars of the loan principal during the years between bankruptcies, in spite of the gambling company’s growing distress."
http://blogs.wsj.com/bankruptcy/2014/09/17/carl-icahn-rakes-in-his-winnings-in-trump-casino-bankruptcy/
"How bad was his time in AC? Consider that Trump found himself in bankruptcy court four times due to his casinos over the years...
1. A bad hair day?
"It started in 1991 when Donald Trump's Trump Taj Mahal found itself in bankruptcy court. The restructuring saw bondholders given 49% of the casino."
2.A severe "haircut"?
"In 1992, it was the Trump Plaza's turn with Chapter 11 restructuring as the casino was sitting on $550 million of debt. Donald Trump once again filed for bankruptcy, and in the process became the butt of many jokes as the only man who could bankrupt a casino --remember this was the 1990's and casino bankruptcies were quite rare. Trump also gave up 49% ownership in the Trump Plaza during the restructuring."...
3. "Ya fired":
"In 2004, the parent company filed for bankruptcy protection again ... and Donald Trump saw his ownership share in the company reduced to 25% along with his title of CEO"
4."Ya fired -AGAIN":
"the company found itself back in bankruptcy court in 2009 ....Trump saw his ownership stake reduced to just 10% and resigned as Chairman of the Board after a heated fight with other owners "....
A Happy ending? ..."give me my damn name back or I'll Tweet really mean things....waaaaahhh":
"Trump currently possesses just a 5% stake in the company that bears his name. No, Donald Trump didn't have a casino close on his watch, but at one point he controlled 30% of the AC casino market, and lost it all and control of his own name on the side of the properties vanish (although more recently he did try to sue to have his name removed)."
http://www.pokerupdate.com/news/business-and-finance/donald-trump-wants-to-save-ac-his-track-record-says-otherwise/
http://www.nj.com/politics/index.ssf/2014/09/chris_christie_ill_welcome_donald_trump_return_to_atlantic_city.html
Well now Governor wants him back too.
I can't help but like Trump, he is so cocky, and absurd, that I can't help feeling the utmost respect for him.
Quote: Gandler"Did you notice how Atlantic City lost its magic after I left"- Trump
http://www.nj.com/politics/index.ssf/2014/09/chris_christie_ill_welcome_donald_trump_return_to_atlantic_city.html
Well now Governor wants him back too.
I can't help but like Trump, he is so cocky, and absurd, that I can't help feeling the utmost respect for him.
Well then, I think you''ll love the potential new Revel owner.
He makes Donald look like Mr Rogers.
Quote: 7star4nowWell then, I think you''ll love the potential new Revel owner.
He makes Donald look like Mr Rogers.
Who is that? I must have missed the news?
By HOWARD STUTZ
LAS VEGAS REVIEW-JOURNAL
Ultimate Gaming, one of just two companies operating in both the Nevada and New Jersey Internet wagering markets, said Friday it was ending its agreement with the Trump Taj Mahal in Atlantic City after less than a year.
The Las Vegas-based company, which is majority owned by Station Casinos, said in a statement its contract with the financially troubled Boardwalk hotel-casino was being “terminated due to multiple breaches by Trump Taj Mahal Associates.”
http://www.reviewjournal.com/business/casinos-gaming/ultimate-gaming-ending-agreement-trump-taj-mahal
Quote: 7star4nowHappy recap of The Donald's "good old days" in AC:
"How bad was his time in AC? Consider that Trump found himself in bankruptcy court four times due to his casinos over the years...
1. A bad hair day?
"It started in 1991 when Donald Trump's Trump Taj Mahal found itself in bankruptcy court. The restructuring saw bondholders given 49% of the casino."
2.A severe "haircut"?
"In 1992, it was the Trump Plaza's turn with Chapter 11 restructuring as the casino was sitting on $550 million of debt. Donald Trump once again filed for bankruptcy, and in the process became the butt of many jokes as the only man who could bankrupt a casino --remember this was the 1990's and casino bankruptcies were quite rare. Trump also gave up 49% ownership in the Trump Plaza during the restructuring."...
3. "Ya fired":
"In 2004, the parent company filed for bankruptcy protection again ... and Donald Trump saw his ownership share in the company reduced to 25% along with his title of CEO"
4."Ya fired -AGAIN":
"the company found itself back in bankruptcy court in 2009 ....Trump saw his ownership stake reduced to just 10% and resigned as Chairman of the Board after a heated fight with other owners "....
A Happy ending? ..."give me my damn name back or I'll Tweet really mean things....waaaaahhh":
"Trump currently possesses just a 5% stake in the company that bears his name. No, Donald Trump didn't have a casino close on his watch, but at one point he controlled 30% of the AC casino market, and lost it all and control of his own name on the side of the properties vanish (although more recently he did try to sue to have his name removed)."
http://www.pokerupdate.com/news/business-and-finance/donald-trump-wants-to-save-ac-his-track-record-says-otherwise/
Donald Trump, who tweeted about heading back to Atlantic City to possibly open a new casino this week, tells us he’s going to take a serious look at the struggling city.
“I left seven years ago,” Trump told us at the Central Park Horse Show Thursday. “I had great years in Atlantic City, I did well in Atlantic City. I’m gonna take a look at it. Not the same place, unfortunately.”
The Trump Plaza, which Trump no longer owns, closed Tuesday and Trump Entertainment Resorts, which owns the Trump Taj Mahal casino, which he also does not own, filed for bankruptcy this month.
“I feel very badly for a lot of people that are there,” the Donald continued. “So many people are being laid off in Atlantic City, there’s so many of them closing up. I will take a good, serious look.”
Earlier this week, Trump tweeted, “It is so sad to see what has happened to Atlantic City. So many bad decisions by the pols over the years — airport, convention center, etc.,” and, “Does anybody notice that Atlantic City lost its magic after I left years ago?”
"If an agreement is not reached by Oct. 3, Taj executives will tell New Jersey authorities it is planning to close the casino ...The company’s owners — including Marc Lasry’s Avenue Capital — are not interested in pumping any more money into the company, sources said...
The company wants to stop making health insurance payments of roughly $10,000 a year for each union employee and to halt pension contributions.
Trump Entertainment would prefer the workers, many of whom are cooks and housekeepers earning less than $30,000 a year, enroll in the Affordable Care Act. If that happens, the company would pay a $2,000 annual penalty per worker for not offering benefits — far less expensive than the present $10,000 cost, the source said."
http://nypost.com/2014/09/22/carl-icahn-might-save-trump-taj-mahal-under-right-conditions/
Mr. Icahn said, "It's unbelievable to me that the Union is somehow blaming me that the Taj may close. I've never had anything to do with management at the Taj." Trump Entertainment management approached him with a request to invest in a turnaround effort, conditioned on agreements with the union, city and state, according to the post. Mr. Icahn said he responded, "My general rule is not to throw good money after bad, however, I told the company that if they could get the other concessions enumerated by them, I would consider doing my part."
"Kris Hansen, attorney for the company, said Monday that the company is trying to keep the Taj Mahal open. "We are bargaining in good faith. We question whether the union is. In response to what we believe are reasonable requests designed to keep the Taj Mahal open and our employees working, the union is inviting customers to go elsewhere and citing labor unrest. That kind of attitude is confusing and counterproductive to the goal of saving jobs."
Another Icahn-controlled casino, Tropicana Casino and Resort Atlantic City, sent Unite a letter stating that "major reductions" to "bloated union contracts" are needed so Tropicana can "avoid the fate of other failed casinos and the terrible job losses that are happening to your members," Mr. McDevitt said."
" McDevitt said the price demanded by an Icahn affiliate is too high. In order to reel in the promise of fresh cash, workers would have to surrender their health-care benefits and survive on average wages of $12 an hour"
Quote: FroggerSo the union would rather lose their jobs completely than work? Good going America
Well, there's obviously a break-even point. Plenty of things are better than working 3rd shift for $12/hr with no health benefits. Far fewer things are better than working 3rd shift for $15/hr with employer-paid health care.
Say you have 4000 employees. 2000 of them won't work with the lower pay and lesser benefits. But 2000 will.
You know Taj will close if the union doesn't give in, the financials just aren't there to keep the business alive without Union concessions.
So the Union can deny concessions and kill all 4000 jobs. Or they accept and let the 2000 people who aren't willing to work go off on their own and find other jobs elsewhere if they so choose.
There is no third option of negotiating and keeping all 4000 jobs and current pay and benefits.
The union can choose to screw 2000 people or 4000. Their choice. I would choose to screw 2000.
It's like being dealt a 16 against a 10. Its a tough spot, and hitting still means you are more likely to lose, but hitting is a better option than standing. There is no third option of getting new cards
Bad news: "To get the Chapter 11 plan off the ground, however, Trump Entertainment needs tens of millions of dollars worth of concessions from a union and a city that have both already said "no."
http://online.wsj.com/articles/trump-entertainment-files-chapter-11-turnaround-plan-1412195699
Quote: 7star4now
http://online.wsj.com/articles/trump-entertainment-files-chapter-11-turnaround-plan-1412195699
Please don't post links to articles where
you need to pay to read it.
Quote: EvenBobPlease don't post links to articles where
you need to pay to read it.
try googling Trump Entertainment Files Chapter 11 Turnaround Plan & close the popup- works for me
Quote: vendman1You may be right...but I don't understand something. If you don't intend to operate the casino and let it go bankrupt...concessions from the employees are meaningless. So why bother playing hardball with the union if you are planning to let it go bankrupt. Doesn't make sense. I think he's trying to leverage his position to one of 100% control.
Take a look at Carl Icahn and Frank Lorenzo in the 80's, with their asset-stripping, union-busting tactics, taking TWA and Eastern Airlines (respectively) into huge union concessions and bankruptcy before destroying the assets to pay their LBO debts and skim the cream.
No reason to think Icahn's doing anything differently with his casinos.
Quote: beachbumbabsTake a look at Carl Icahn and Frank Lorenzo in the 80's, with their asset-stripping, union-busting tactics, taking TWA and Eastern Airlines (respectively) into huge union concessions and bankruptcy before destroying the assets to pay their LBO debts and skim the cream.
No reason to think Icahn's doing anything differently with his casinos.
hmm...well you are right about Ichan's past financial dealings. In those cases though..there were plenty of hard assets to sell. In those LBO's of the 80-90's the pieces were literally worth more than the whole. So they would do what you just said...do a hostile takeover or LBO and sell everything for parts and make a huge chunk for themselves. The situation with Icahn and the Taj Mahal is different. He holds the mortgage on the property..which they have no hope of paying without a profitable casino. Driving them to bankruptcy may indeed get Ichan control of the company/building...but for what. It would be worth much less than he has invested already. He has hundreds of millions in this already. If the Taj goes out of business he'd be left holding the bag. I have no doubt he's playing some insiders angle her that I'm not seeing. But I doubt anybody else is seeing it either.
Quote: vendman1hmm...well you are right about Ichan's past financial dealings. In those cases though..there were plenty of hard assets to sell. In those LBO's of the 80-90's the pieces were literally worth more than the whole. So they would do what you just said...do a hostile takeover or LBO and sell everything for parts and make a huge chunk for themselves. The situation with Icahn and the Taj Mahal is different. He holds the mortgage on the property..which they have no hope of paying without a profitable casino. Driving them to bankruptcy may indeed get Ichan control of the company/building...but for what. It would be worth much less than he has invested already. He has hundreds of millions in this already. If the Taj goes out of business he'd be left holding the bag. I have no doubt he's playing some insiders angle her that I'm not seeing. But I doubt anybody else is seeing it either.
I think you hit his predicament on the head.
I agree "If the Taj goes out of business he'd be left holding the bag".
However, if Taj stays open, he risks losing more $.
Not something Icahn has ever shown an appetite for, he usually cuts bait as soon as a deal goes south
That's why I think Icahn, being Icahn, sees the only benefit to salvage out of the Taj deal is to string along Taj labor, using them prove that he is willing & able to take his bat & ball & go home now,& when it comes to Trop- which he seems inclined to keep open otherwise.
“He (Icahn) doesn’t want it (Trump Plaza) open,” Sweeney said. “He doesn’t want the Taj Majal open. So then he comes up with these ridiculous offers — that he’s going to strip all the benefits. Why doesn’t he tell people he’ll keep the place open if they’ll work for free?”
