Posted on 04/10/2011 8:43:48 PM PDT by mnehring
Donald Trump's Atlantic City empire includes the Trump Taj Mahal. The casino company that bears Donald Trump's 24-karat name is heading for bankruptcy.
Trump sees bankruptcy as nothing more than a beneficial legal mechanism. There is no shame in bankruptcy, Trump says,"It doesn't matter - it's a modern-day thing, a legal mechanism," he told the Daily News.
Trump said he's "really happy" with the restructuring agreement that Trump Hotels and Casino Resorts has made with its largest group of bondholders, pavings the way for a $345 million investment from Credit Suisse First Boston.
The plan will be able to be carried out as the result of a pre-negotiated Chapter 11 bankruptcy proceeding.
That's right, $1.8 billion in debt will be cut by $544 million dollars, and the interest rate on the remianing portion of the debt will be reduced from about 12% to 7.875%. This will put Trump Hotels on an equal footing with competitors. Not only that, the deal gets a whopping $500 million line of credit for the renovating of the aging Atlantic City properties, build a new tower at Trump Taj Mahal and expand into the Las Vegas gambling scene.
"It becomes a whole different company," Trump was quoted as saying. Several analysts have said the deal is good enough medicine to heal the cash-starved Trump Hotels, which are known to have not turned a profit in their eight years as a public company, and have struggled to keep up prohibitive debt payments.
Sean Egan of Egan-Jones Ratings, a bond ratings firm, has said "This removes the sword of Damocles that was hanging over the company".
Trump insisted, as part of the restructuring efforts, to the investing of $55 million in cash of his own money. This was his idea, rather than a demand by Credit Suisse or the bondholders.
Trump will now be chairman instead of chief executive, and his ownership stake will be down to 25% from the original 56%. The star of "The Apprentice" will however, stay involved in Trump Hotels and be paid an annual salary of some $2 million. Apparently bankruptcy has it's advantages.
Trump will be overseeing development interests and projects, and deal with government officials in new markets the company enters.
"It was extremely important that Trump be incentivized to work with us," said excecutive vice president Scott Butera, who's in charge of the financial restructuring of the Atlantic City empire which includes the Trump Taj Mahal.
Donald John Trump, born June 14th, 1946, was the son of Fred Trump, a multi-billion dollar real estate mogul.
After attending the Wharton business school, Trump joined the family real estate business. A self-promoting and flamboyant dealmaker, he was able to secure loans with minimal collateral in the free-wheeling 1980s and created an empire in real estate, casinos, sports, and transportation.
By 1990, however, the effects of recession had left him unable to meet loan payments. Although he shored up his businesses with additional loans and postponed interest payments, mounting debt brought Trump to business bankruptcy and the brink of personal bankruptcy. Banks and bondholders lost hundreds of millions of dollars but opted to restructure his debt to avoid risking losing even more in a court fight.
By 1994, Trump had eliminated a huge portion of his $900 million personal debt and reduced substantially his nearly $3.5 billion in business debt. Forced to relinquish the Trump Shuttle (bought in 1989), he retained Trump Tower in New York City and control of his three casinos in Atlantic City.
Chase Manhattan, which lent Trump the money he needed to buy the West Side yards, his biggest Manhattan parcel, forced a sale of the parcel to Asian developers. According to former members of the Trump Organization, Trump did not retain any ownership of the site's real estate - the owners merely promised to give him about 30 percent of the profits once the site was completely developed or sold. Until that time, the owners kept Trump on to do what he did best: build. They gave him a modest construction fee and a management fee to oversee the development. They also allowed him to put his name on the buildings that eventually rose on the yards because his well-known moniker allowed them to charge a premium for their condos.
In 1995, he combined his casino holdings into the publicly held Trump Hotels & Casino Resorts. Wall Street drove its stock above $35 in 1996, but by 1998 it had fallen into single digits as the company remained profitless and struggled to pay just the interest on its nearly $2 billion in debt. Under such financial pressure, the properties were unable to make the improvements necessary for keeping up with their flashier competitors.
In 1999 Donald's father Fred Trump passed away. The same man who co-signed Donald's first business loans, also happened to be the man who enabled Donald to escape from the massive financial morass he had created over the decades. Unfortunately, creditors who got stuck with the past losses were not as fortunate, being forced to take catastrophic writeoffs and losses even up to 2004 when Trump refused to continue to back his casino.
Trump toyed with the idea of running for president on the Reform party ticket. Crippling debt payments forced his casinos into bankruptcy again in 2004, and Trump's stake in the company was greatly reduced when it emerged from bankruptcy in 2005. Widely known as simply “the Donald,” Trump stars in his own reality television show, which debuted in 2004.
Although Trump boasted he would build a bigger empire than his father, in the end, his father had built an empire large enough to accommodate even Donald's most lavish personal losses.
Donald J. Trump continues to be a successful business entrepreneur to this day.
The Forbes 400 lists his net worth at $2.7 billion, though Trump himself claims to be worth over $5 billion. However, on October 26 2005 the New York Times published an investigation into the history of Trump's net worth which suggested that the figures stated by Forbes have regularly been several times greater than his actual worth, even though they have been much lower than Trump's own personal estimates.
Mirror image is right. No doubt about it.
Trump and Giuliani, two liberal Republicans in the fast lane.
Just to put it in comparison, here is Rudy's policy chart. 
..and Bill Clinton's chart
From ontheissues.org He is way closer to Bill Clinton than he is someone we all agree is a RINO.
See #42, He is actually a lot closer to Bill Clinton on issues than he is Rudy. Heck, he actually makes Rudy look Conservative.
Yes, well how Rudy handled 9/11 was a reaction to a disaster, a crisis, an attack. Not economic which is where the US is bleeding right now. Rudy's handling of the attack of the Twin Towers and running and economics seems to be comparing apples to oranges, don't you think?
A lot of policies identical to Trump's.
Trump's policies based on which office of government he has held?
Positions he has taken such as policies he has directly supported and politicians he has supported financially. Such as supporting Obamacare or his history of donations to Democrats by a greater margin than Republicans. Michelle Malkin had a good piece on it. Also, ontheissues.org has a good break down policy by policy. Actually going back, I found he is almost identical to Bill Clinton on policy, Rudy wasn't the best example looking at Trump's whole history. He makes Rudy look Conservative.
I don't see how you can judge a man's issues who has not yet help political office and he's just starting to tell where he stands.
He has been telling us where he stands for years, mostly with his pocket book on what he supports and finances. He is no mystery. We have a long documented history of Trump and it isn’t standing for Conservative causes. We don’t need to take his pandering for the camera now at face value, we can weigh it by his history to see if he is telling the truth.
They place Giuliani in the conservative quadrant. I don't buy it. Trump and Giuliani are liberals and nothing anyone says will ever change that. Same goes for Romney.
"By the time of his death, [Fred] Trump had amassed a $400 million estate" - Wikipedia
And if I had a business in New York City you can bet I would also be donating to at least both sides as well especially if it will get me favors.
GE paid zero taxes last year for doing that.
As long as it's still legal, you gotta do what you gotta do to keep up with the competition.
Let's not forget, George W Bush passed the medical prescription bill. Trump wants more competition among health insurance companies. Which of those 2 ideas is less socialist?
“He takes big risks but uses the government bankruptcy system to his advantage so he doesn’t face the consequence of massive debt that doesn’t reap a return”
Isn’t that “just business”? Who is extending credit to him? He can’t have debt without someone willing to loan. And if they’re willing to loan they must foresee a profit from doing so.
Without money, your children starve.
Without a job, your family could end up homeless
This is going to be the vote for personal survival and not putting a social issue above ones own family.
For social issues we're going to be looking for candidates in the Senate and Congress.
I have seen no evidence that even if trump were pro-choice (and I don't know that he is - I heard he is PRO-LIFE)he's certainly not a pro-choice activist and I doubt any judges he appoints would reflect that and even if it did... we have a Senate to win and need more seats in Congress to assure no passage whether it's Donald Trump in office or another four years of Obama.
Why would anyone worry about social issues of the President when it's either Obama or someone different. Either Obama will win another 4 years of socialism or at the very worst 4 years of a republican. That's the choice.
In the case that Obama may win again we need to assure he will be the lamest duck we've ever seen in the White House in our lifetime. As long as we can assure that, we are safe with a business savvy President.
Yes. Something can be legal and at the same time, unethical.
I always saw Trump as an unethical lout. A bottomfeeder.
Trying to trash Trump because he is trashing Obama’s? Get lost.
How about Trump’s support of progressive income taxes? How about his support of socialized medicine? How about his history of thinking debt is something that can be run-up and just ‘written off’ and spending your way out of a situation?
Yea, he found a loophole that works in his business (with the advantage of inheriting a massive buffer from his dad), but in government, it results in the exact same situation we are in now.
Trashing Trump because he is Bill Clinton on the issues with an R behind his name.
Let the bond holder beware!
Which of the other candidates have the knowledge of business and economics that these two guys have?
Romney would not be able to beat Obama. Romney has a history. As governor he had had own version of “Obamacare”. He would not be able to debate Obama seriously with any credibility on Obamacare without laughs coming from the audience. Romney has a proven history as Governor as a RINO. Romney is much like McCain... he is too nice and will let the democrats and Obama walk all over him.
Who does that leave?
It leaves Trump and whatever other candidate on our side that has as much knowledge in economic and business as Trump.
So, who is it? And will America vote for that person?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.