In a move that couldn’t be worse timing for The Donald, the Associated Press is reporting that Carl Icahn is shutting down the Trump Taj Mahal casino in Atlantic City. While Trump currently has no stake in the casino (he lost his ownership to bondholders in a previous bankruptcy filing) we have a sneaking suspicion that his rivals will take advantage of this opportunity to highlight his previous failed business endeavors. For his part, Icahn acquired his stake in the Trump Taj Mahal during it’s previous bankruptcy filing. Icahn is attributing the closure of the casino to a strike by its unionized workers over wages and health insurance costs. The casino is expected to be closed after Labor Day and will result in 3,000 job losses for the struggling Atlantic City.
In comments made to the Associated Press, Icahn said that he lost nearly $100 million on the Taj Mahal in the past 18 months, including money he spent to keep it afloat during bankruptcy court before he even owned it, added that “It was a bad bet. How much good money do you throw after bad?”
Tony Rodio, CEO of the casino, said that Icahn has spent $100mm trying to save the Taj in Atlantic City. He continued:
“Currently the Taj is losing multimillions a month, and now with this strike, we see no path to profitability. Our directors cannot just allow the Taj to continue burning through tens of millions of dollars when the union has single handedly blocked any path to profitability.“
This post was published at Zero Hedge on Aug 4, 2016.
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