Billionaire Carl Icahn says he lost almost $100 million on his takeover of Atlantic City’s Trump Taj Mahal casino. Only seven casinos remain in the southern New Jersey resort town best known for its iconic Boardwalk.
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The union’s main point of contention has been the loss of their health insurance benefits and pension, as a bankruptcy court judge ruled in favor of allowing the owners of the casino to eliminate these perks back in 2014. Icahn previously said the company offered a contract that would have temporarily restored health care, but at a lesser level than employees of the city’s other seven casinos.
“It was a bad bet”, Icahn told the Associated Press. Local 54 President Bob McDevitt criticized the intent to shutter the Taj, describing it as “petty”.
On August 1, a public affairs company which releases union information to the press stated in an email, “As the sole debtholder between 2010 and 2014, Icahn extracted $350 million from the property, driving it into bankruptcy and then swooping in to take control”. The Trump Taj Mahal, which bares his name, is closing, according to an announcement today. For a few million bucks, he could have had labor peace and a content workforce. A workers’ strike that has been going on for over a month now seems to finally have broken the business for good. And I do believe in Icahn and Tony Rodio, that if they would have turned it around, they would have gave (the workers) their money.
“Currently the Taj is losing multi-millions a month, and now with this strike we see no path to profitability”, [Tony Rodio, President and Chief Executive Officer of Tropicana Entertainment] said in the statement. In 1976, New Jerseyans elected to become the second state, after Nevada, with legal casinos.
“In the end he’ll have to live with what he’s done to working people in Atlantic City”, he said.
The construction saw years of delays, but when it finally opened, the 429-foot tower was the tallest casino in the city. Tropicana Entertainment is 65 percent owned by Icahn Enterprises. It had the most slot machines and gambling tables.
Icahn became the owner of the Taj Mahal after taking the casino’s mounting debt.
The closure of the Taj will add to a handful of other casinos that have closed in Atlantic City in the last two years, shedding an estimated 8,000 jobs, city officials have said. Well before the poker boom and rise of No-Limit Hold’em as the poker game, the Taj was the home to hundreds of east coast regulars and was known for churning out some of the best Stud players in the world.
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The Taj Mahal says it is losing millions of dollars and needs an 18-month breathing period in order to rebuild its business and cash flow. Now its businesses are facing mounting financial struggles, and the city government is struggling to stay solvent.
