Trump tries to buy land his company owns

Geoff Mulvihill

Monday, July 11, 2005 | 9:19 a.m.

CAMDEN, N.J. -- The Donald upped the ante Friday on his latest deal: trying to buy an Atlantic City property one of his companies already owns.

Earlier this year, when the publicly held company now known as Trump Entertainment Resorts Inc., was entering bankruptcy, some shareholders objected, saying the deal was good for Chairman Donald Trump and bad for them.

To sweeten the pot for the investors, the company agreed to auction off the Boardwalk parcel where Trump World's Fair Casino once stood and give the proceeds to the shareholders, along with _$17.5 million in cash.

The land was appraised at _$7.5 million and an auction is planned for September.

The bidding began, unofficially at least, during a hearing in federal court Friday.

Another bidder, Robino Stortini Holdings, Inc., was to be the "stalking horse" in the auction, setting a floor for bids at _$13.5 million -- but charging a fee of _$360,000 to investors if the company lost.

The Trump Organization, a privately held company, said it would start the bidding at _$14.2 million -- and not charge a penny for the service. Trump himself was not in the courtroom, but his lawyer, Scott Cargill, was almost as dramatic as the mogul.

"Put the gavel down," Cargill told the judge at one point, as Robino Stortini tried to up its bid. "Let us be the stalking horse."

Trump plans to try to take on all comers in the real auction Sept. 13.

Why was the star of "The Apprentice" so anxious to have the right to make the first bid when the last one is the one that matters?

One of his lawyers, Michelle Lokey, said it was largely out of benevolence, to make sure shareholders get as much money as they can.

Under the bankruptcy restructuring, Trump gave up his rights to put a new casino on the 2.5-acre parcel where he had once proposed a 62-floor, 4,612-room hotel atop a casino.

Lokey said Trump would like to put up "something residential" on the property next to Boardwalk Hall.

"He still thinks that Atlantic City is a profitable market," Lokey said.

In a courtroom with more than a dozen lawyers Friday, U.S. Bankruptcy Judge Judith Wizmur approved Trump as the stalking horse bidder.

But then there was one more question from Trump lawyer Cargill: Could Trump preserve the right to charge stockholders a fee for that role?

Wizmur said Trump could ask about that later.