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StumbleNew Jersey hands over Tropicana control to Carl Icahn
Wednesday, March 3, 2010 | 5:40 p.m.
ATLANTIC CITY, N.J. — New Jersey on Wednesday ended its conservatorship of Tropicana Casino and Resort after 27 months and gave final approval of its sale to billionaire Carl Icahn.
The state Casino Control Commission also gave Icahn interim casino authorization, allowing his company to take over operations. He bought it out of bankruptcy last year for $200 million.
The approval gives Icahn a stronger grip on a quickly expanding empire of casinos he's bought relatively cheap out of bankruptcy.
In January, he received regulatory approval to take control of nine Tropicana Entertainment LLC casinos in Nevada, Indiana, Louisiana and Mississippi as they emerged from a separate bankruptcy.
He's reorganizing them into a publicly traded company and plans to put them eventually under the same umbrella as the Atlantic City landmark.
This year, he also bought the unfinished Fontainebleau Las Vegas casino resort on the strip. On top of all that, last December, he bought the first-lien debt in Trump Entertainment Resort's three Atlantic City casinos. Now, he and banker Andy Beal are slugging it out against a group that includes Donald Trump to become the owners when that company emerges from bankruptcy.
New Jersey regulators took a major role in running the Tropicana after refusing to renew the operating license of then-new owner William J. Yung III in December 2007, when his drastic cost-cutting measures left the casino dirty and understaffed.
Former state Supreme Court Justice Gary Stein became conservator for the state.
Wednesday's action gives Icahn's company authorization to run the casino for nine months — it could be extended to a year — while regulators investigate its suitability to operate the casino permanently.
As part of the interim authorization, the Tropicana Atlantic City Corp. created a new trust overseen by Harold First, who has worked for Icahn in the past.
"This is a major step in what has been a more lengthy process than any of us could have anticipated," Casino Control Commission Vice Chairwoman Sharon Anne Harrington said. She said Icahn's return to casinos in New Jersey brings a "sign of rejuvenation and optimism in the market."
From 2000 to 2006, the investor owned the Sands Hotel & Casino.
Atlantic City's casinos have had three consecutive years with falling revenue as they have contended with a recession and increased competition in Pennsylvania and other nearby states.
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Man these big dogs get into financial areas most of us regular people have no understanding of nor any desire to understand, except that we hope they will all reopen and bring jobs back..
I hope Icahn will be able to make those properties profitable without laying out to many workers. waiting to see his capital structure when he goes public... might be a good investment opportunity.
"This is a major step in what has been a more lengthy process than any of us could have anticipated," THAT IS AN UNDERSTATEMENT. Judge Stein Fleeced the place for MILLIONS in legal fees, limo rides etc while the employees and the physical plant continued to suffer. While I do not believe Columbia Sussex to be a good casino operator, the NJ CCC has proved successful over the past few years in devaluing properties, hampering private enterprises and running successful qualified operators out of town. Well done NJ! I hope the Christie Administration starts cleaning up like he promised.
Does anyone get tired of the poor sentence structure these reporters are using in the leading paragraphs (and throughout the rest of the written story)?????
It is NOT 'New Jersey on Wednesday' because New Jersey is NOT ON Wednesday, but rather it is: "On Wednesday, New Jersey.....", etc.
Not only is the grammar in error, but the punctuation is also erroneous.
It's hard to trust the reliability of a news story when basic grammatical errors are made, but given the information in the story, I'm expecting better things from Ichan since his reputation for being a fair and sound business-person has long been publicized.
I think it augers well for the casino and its employees..........................
to oldladyplayspiano:
I totally agree with you! and not only this article It happens too often and all over the internet...
the faulty writing reflects the need for copy editors--real live copy editors, not the microsoft word spellcheck, language and grammar option on the computer. the computer recognizes some errors, but not all. for instance, if you type "good buck" when you really meant "good luck", the computer will not recognize the error because "buck" is a valid word. similarly, with modifying clauses and other grammatical nuances.