Associated
Press
Offshore Company Offers $400M to Trump
09.28.2004, 03:14 PM
An Internet
casino operator said it is offering Donald Trump $400 million for a stake
in his ailing casino company.
Casino Fortune,
a Trinidad-based company, said Tuesday it has approached Trump about replacing
DLJ Merchant Banking Partners, whose plans for a bailout of Trump Hotels
& Casino Resorts Inc. fell through last week.
Trump didn't
return calls seeking comment Tuesday. Executive vice president Scott Butera
said the company had been contacted by Casino Fortune but would not say
whether the offer was being considered.
"We've
received a correspondence, but I don't have any comment about Casino Fortune,"
Butera said.
Officials
at Casino Fortune, which bills itself as the world's oldest online gambling
company, acknowledged Tuesday that they had never spoken to Trump officials
about the offer, which they said was made in hand-delivered letters over
the weekend.
But the bid
- which Casino Fortune estimates would give it a 31 percent share in Trump
Hotels - is legitimate, said vice president Dennis Rose.
"We
find the guy so vibrant, such an exciting character. If there's a rescue
possible, we'd like to be part of it," he said in a telephone interview
from Port of Spain, Trinidad.
In separate
letters to Trump and Trump Hotels chief financial officer Francis X. McCarthy,
Rose said Casino Fortune was "prepared to immediately enter into
a dialogue regarding financial relief for Trump Hotels & Casino Resorts."
Trump, who
runs the Trump Taj Mahal, Trump Plaza and Trump Marina casinos in Atlantic
City, has fallen on hard times even as his public persona soars on the
wings of "The Apprentice," his reality TV show.
Trump Hotels
holds $1.8 billion in debt and spends so much money on interest payments
it has not been able to invest in improving its casino properties, which
face stiff competition.
DLJ Merchant
Banking Partners, a private equity arm of investment bank Credit Suisse
First Boston, had been negotiating for a stake in Trump Hotels, offering
$400 million in exchange for a controlling interest. Under the deal, Trump
would have given up his majority stake and his title as CEO.
Casino Fortune,
which runs eight casinos in the Caribbean, Africa and Europe, is making
the bid because it wants a land-based casino in the United States to add
to its credibility, Rose said.
The company
is privately held; officials would not give financial information about
revenues, holdings or assets.
Internet
gambling - playing blackjack, poker and other games on a computer, using
a credit card - is currently illegal in the United States. In 2001, New
Jersey casino regulators filed suit against 10 alleged Internet gambling
operators it said had been taking bets from state residents.
Thomas Auriemma,
director of the New Jersey Division of Gaming Enforcement, said any company
acquiring 5 percent of more of a public casino company operating in New
Jersey would have to submit to licensure investigation.
"I have
no idea if the thing is sincere or not," he said of Casino Fortune's
offer. "If it is, we'll have to look at it. But certainly, the activities
of that company in soliciting bets from Americans and New Jerseyans would
be highly relevant," said Auriemma, whose agency enforces casino
laws in New Jersey and presents findings to the state Casino Control Commission.
The company
may just be out for publicity, said one industry observer.
"A lot
of these Internet gaming companies go to extraordinary lengths to get
publicity, whether it's putting a tattoo on a streaker at the Super Bowl
or buying advertising space on Danny Bonaduce's back in celebrity boxing,"
said Joe Weinert, vice president of Spectrum Gaming, a casino consultancy.
"They're very innovative that way."
Associated
Press Writer Jeffrey Gold in Newark contributed to this story.
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