|By Suzette Parmley, The Philadelphia
InquirerMcClatchy-Tribune Regional News
Oct. 6, 2007 - Cordish Co., a Baltimore developer in a legal fight with Donald Trump over a casino development in Florida, is in talks to buy Trump's Atlantic City casinos, according to a Cordish executive who asked not to be named because of the sensitivity of the talks.
Cordish, which developed the giant outlet mall in Atlantic City called The Walk, has experience in real estate developments featuring dining and entertainment, and is building up its gaming division. Through its affiliate Power Plant Entertainment L.L.C., it developed two Hard Rock-themed hotels and casinos in Hollywood and Tampa, Fla., with the Seminole tribe.
Trump's pending suit against Cordish, filed in December 2004, accused the developer of stealing Trump's plans for a casino in partnership with the Seminoles. Cordish said that Trump walked away from the venture after former Gov. Jeb Bush, strongly opposed to expanding gambling in Florida, was elected in 1998.
Trump's former confidant Richard Fields and others are named in the suit.
A separate suit was filed against Cordish by the Seminoles over profits from the casino, and Cordish fired back with its own lawsuit accusing the tribe of a bid-rigging plan. In April, both sides withdrew their allegations and settled amicably.
It remains unclear what, if any, connection there is between the Florida case and Cordish's interest in Trump's Atlantic City casinos.
"I have no comment," said Trump.
Calls to Gary Block, vice president of Cordish, were not returned.
But Trump did say as recently as last month that his Trump Entertainment Resorts Inc. -- which owns and operates the Trump Taj Mahal, Trump Plaza and Trump Marina casinos -- was still for sale.
"We're still talking to a lot of people," Trump said on Sept. 14. "There is still a lot of interest."
Many say the success of Cordish's $49 million Walk project has helped to cushion some of the slots-business losses to Pennsylvania and New York by spurring Atlantic City's casinos to adopt non-gaming attractions.
The Walk recently completed a $155 million expansion that added five blocks in August.
Analysts say a major obstacle in finding a buyer for Trump has been the company's $1.5 billion debt, even after a 2005 Chapter 11 restructuring gave the company a $500 million line of credit from investment firm Morgan Stanley.
"My tagline for this would be 'Here we go again,' " said Barbara Cappaert, a high-yield bond analyst with KDP Investment Advisors Inc. of Montpelier, Vt. "The reality is that the stock is lower than where it was when Trump tried to sell it before."
This summer, Trump Entertainment was courted by a partnership of New York real estate magnate Morris Bailey and former Trump Taj Mahal executive Dennis Gomes. The duo unsuccessfully bid for a slots license in the Poconos in 2006.
The deal collapsed primarily over price. Trump and Morgan Stanley wanted more than Bailey and Gomes offered, according to sources knowledgeable about the negotiations.
Trump has veto power over the sale of any of the casinos under the 2005 reorganization agreement. If he waives that right, Trump Entertainment would have to pay him up to $100 million to cover taxes he would owe in a sale.
Trump shares closed at $8.30 yesterday, up $1.31, or 18.74 percent, but still lower than on July 2, the day Trump Entertainment said the Bailey-Gomes deal was off the table. Trump shares closed at $10.49 that day.
Contact staff writer Suzette Parmley at 215-854-2594 or email@example.com.
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