An obscure offshore Internet gambling company yesterday proposed spending $400 million for a 31 percent stake in Donald Trump's casino company.
Press Clippings
Internet casino offers $400M for stake in Trump Resorts
Tuesday, September 28, 2004 BY BETH FITZGERALD Star-Ledger Staff
An obscure offshore Internet gambling company yesterday proposed spending $400 million for a 31 percent stake in Donald Trump's casino company, which is regrouping following the collapse last week of an unrelated bailout deal.
Trump, the chairman and chief executive of Trump Hotels and Casino Resorts, said yesterday he hadn't seen the offer from Casino Fortune, a private company that claims 2 million online gambling customers in the United States as well as land-based casinos in the Caribbean, Europe, Asia and Africa.
"I have not seen anything from them. I know nothing about it, and so obviously, we can't comment," Trump said.
Trump's casino company, which owns three of the 12 casinos in Atlantic City, is struggling to keep up the interest payments on $1.8 billion in debt. In August, Trump announced a plan to restructure the company with fresh investment from DLJ Merchant Banking, a private equity group affiliated with Credit Suisse First Boston. The casino company agreed to enter Chapter 11 bankruptcy protection in order to complete the restructuring.
Last week, however, Trump and DLJ issued a statement saying the deal had been canceled.
Casino Fortune, based in Trinidad, said yesterday it hopes to open negotiations with the Trump organization, and figures its offer of a $400 million investment for a 31 percent stake should be attractive. DLJ had proposed investing $400 million for a 55 percent stake.
"Right now, we are just declaring our interest," said Dennis Rose, senior vice president and general manager of Casino Fortune. "This is a preliminary contact we are making, and I hope we will be able to put some meat on the bones of a deal."
But Casino Fortune faces a critical legal hurdle, since Internet gambling is illegal in the United States, said Tom Auriemma, director of the state Division of Gaming Enforcement.
"Offshore companies are taking bets illegally from U.S. citizens," Auriemma said.
Casino Fortune would need to be investigated and licensed before buying a piece of Trump's casino company. "Any online company that operated in what we would think was an unlawful situation certainly would be subjected to intense scrutiny if they applied for licensure in New Jersey," Auriemma said.
Casino Fortune spokesman Kevin Mercuri said the company might be willing to give up its online gambling operations in order to do a deal with Trump.
"This is a matter of government regulation not keeping pace with technology; sooner rather than later, online gaming will be sanctioned by state and local governments," he said. "But if we have to sell off our Internet gaming business in order to work with the Trump organization, then it would be worthwhile to take a small step backward in order to take a giant step forward."
Casino Fortune
Press Clippings
Internet casino offers $400M for stake in Trump Resorts
Tuesday, September 28, 2004 BY BETH FITZGERALD Star-Ledger Staff
An obscure offshore Internet gambling company yesterday proposed spending $400 million for a 31 percent stake in Donald Trump's casino company, which is regrouping following the collapse last week of an unrelated bailout deal.
Trump, the chairman and chief executive of Trump Hotels and Casino Resorts, said yesterday he hadn't seen the offer from Casino Fortune, a private company that claims 2 million online gambling customers in the United States as well as land-based casinos in the Caribbean, Europe, Asia and Africa.
"I have not seen anything from them. I know nothing about it, and so obviously, we can't comment," Trump said.
Trump's casino company, which owns three of the 12 casinos in Atlantic City, is struggling to keep up the interest payments on $1.8 billion in debt. In August, Trump announced a plan to restructure the company with fresh investment from DLJ Merchant Banking, a private equity group affiliated with Credit Suisse First Boston. The casino company agreed to enter Chapter 11 bankruptcy protection in order to complete the restructuring.
Last week, however, Trump and DLJ issued a statement saying the deal had been canceled.
Casino Fortune, based in Trinidad, said yesterday it hopes to open negotiations with the Trump organization, and figures its offer of a $400 million investment for a 31 percent stake should be attractive. DLJ had proposed investing $400 million for a 55 percent stake.
"Right now, we are just declaring our interest," said Dennis Rose, senior vice president and general manager of Casino Fortune. "This is a preliminary contact we are making, and I hope we will be able to put some meat on the bones of a deal."
But Casino Fortune faces a critical legal hurdle, since Internet gambling is illegal in the United States, said Tom Auriemma, director of the state Division of Gaming Enforcement.
"Offshore companies are taking bets illegally from U.S. citizens," Auriemma said.
Casino Fortune would need to be investigated and licensed before buying a piece of Trump's casino company. "Any online company that operated in what we would think was an unlawful situation certainly would be subjected to intense scrutiny if they applied for licensure in New Jersey," Auriemma said.
Casino Fortune spokesman Kevin Mercuri said the company might be willing to give up its online gambling operations in order to do a deal with Trump.
"This is a matter of government regulation not keeping pace with technology; sooner rather than later, online gaming will be sanctioned by state and local governments," he said. "But if we have to sell off our Internet gaming business in order to work with the Trump organization, then it would be worthwhile to take a small step backward in order to take a giant step forward."
Casino Fortune
Last edited by a moderator: