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Trump Entertainment Resorts in Negotiations to Sell Trump Marina Hotel Casino
to Landry's Restaurants, Owners of Golden Nugget Casino Hotel in Nevada

By Donald Wittkowski, The Press of Atlantic City, Pleasantville, N.J.McClatchy-Tribune Regional News

Feb. 09, 2011--ATLANTIC CITY -- Trump Entertainment Resorts Inc. is in negotiations to sell Trump Marina Hotel Casino to the owner of the Golden Nugget casino hotels in Nevada.

People familiar with the talks said the would-be buyer is Houston-based Landry's Restaurants Inc., a diversified company whose holdings include the Golden Nugget properties in Las Vegas and Laughlin, Nev., the Rainforest Cafe chain and the West Coast-based Claim Jumper restaurant group.

Bob Griffin, Trump Entertainment chief executive officer, said Tuesday that a confidentiality agreement prevented him from disclosing the name of the potential buyer. He said a deal could be wrapped up as soon as this month. He noted negotiations have entered the "due diligence" phase, in which a buyer scrutinizes the finances of the business that it wants to acquire as a prelude to a sale.

"The process is moving along quite well," Griffin said. "We may have a deal sometime in February. But as of right now, we have no deal."

Last September, Landry's expressed interest in buying the financially troubled Atlantic City Hilton Casino Resort and rebranding it as a Golden Nugget. Landry's backed off when the Hilton became embroiled in a foreclosure fight with its lenders after the casino defaulted on its mortgage.

Landry's is controlled by founder Tilman J. Fertitta, who serves as chairman, president and CEO of the private company. Neither Fertitta nor the company's general counsel, Steven L. Scheinthal, returned calls to Landry's corporate headquarters in Houston.

Landry's already has a presence in Atlantic City through its Rainforest Cafe at Trump Plaza Hotel and Casino.

Griffin said there are other potential buyers waiting in the wings if the current negotiations fall through. He explained that Gov. Chris Christie's sweeping plan to revive the slumping casino market has sparked renewed interest in Atlantic City by investors.

Christie signed a legislative package last week that eases New Jersey's casino regulations and creates a state-run Tourism District to oversee Atlantic City's casino zones, beaches and Boardwalk. The governor used the half-finished $2.8 billion Revel casino project as the backdrop for the bill signing. Revel is close to completing a $1.15 billion financing plan to restart construction on the stalled megaresort.

"Since the Revel signing ceremony, there has been a lot of interest in the assets of Trump Entertainment," Griffin said. "Everything is for sale at the right price. Anybody who tells you that nothing is for sale is kidding you."

Trump Entertainment also owns Trump Plaza and Trump Taj Mahal Casino Resort. Trump Marina's sale is part of the company's restructuring since emerging from Chapter 11 bankruptcy last year under the new ownership of corporate bondholders aligned with Donald Trump.

Griffin said the company would consider selling any of its casinos, but stressed that the Trump Marina deal is the focus at this time. The company would use proceeds from the sale to pay down its $344 million debt.

"We have a strategic plan and are sticking to it," Griffin said. "I think it's disingenuous to say you would never sell. But I don't see us doing anything beyond the Marina in 2011."

Trump Marina is the weakest casino in the Trump gaming empire. Its gaming revenue fell 9 percent in 2010 to $147.4 million, dead last among Atlantic City's 11 casino hotels. Through the first three quarters of 2010, it suffered a $3.4 million gross operating loss. Results for the fourth quarter of 2010 will be released in April.

Once known as Trump Castle, the casino includes 728 hotel rooms and 79,000 square feet of gaming space. Lacking major improvements, the property is essentially the same one that opened in 1985, aside from cosmetic changes and restaurant overhauls. Trump Marina has been overshadowed by its powerhouse Marina District neighbors, Borgata Hotel Casino & Spa and Harrah's Resort.

Trump Marina has been on the market for years, with a series of deals falling apart with different prospective buyers. Most recently, the New York-based gaming company Coastal Marina LLC reached a tentative deal to buy Trump Marina in May 2008 for $316 million amid Atlantic City's pre-recession euphoria in real estate prices.

Coastal wanted to rebrand the property into a Margaritaville-themed casino in partnership with singer-songwriter Jimmy Buffett. The price was later reduced to $270 million before the deal collapsed altogether in 2009.

Trump Marina later symbolized the post-recession plunge in Atlantic City real estate prices. During Trump Entertainment's bout with bankruptcy last year, Coastal emerged again as a possible buyer for only $75 million. Coastal announced in September it was no longer interested in the deal.

Griffin said Trump and Coastal have settled a lawsuit over the aborted sale. Coastal had accused Trump Entertainment of fraud and breach of contract. Trump denied the charges, asserting that Coastal had failed to live up to the terms of the deal.

Contact Donald Wittkowski:



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