New Jersey gaming regulators have approved billionaire Carl Icahn’s takeover of Atlantic City Trump Taj Mahal, which he acquired after a long bankruptcy proceeding.
Representatives for the casino said $15 million will be invested in the property to address immediate needs, but it is still unclear if Icahn will go through with a promised $100 million upgrade of the property. Icahn has said he does not want to make the investment if the state approves the building of two new casinos in northern New Jersey—a move he says will devastate the Atlantic City market.
Tropicana president Tony Rodio—now president of a new entity that will manage the Taj Mahal—told the state Casino Control Commission that Tropicana Entertainment, which Icahn also owns, will invest $15 million right away to fix pressing needs at the Taj Mahal, according to the Associated Press.
Repairs include leaky roofs in the property’s Chairman Tower and renovating 150 hotel rooms that have been out of service, but Rodio could not say if the $100 million renovation will also take place.
“It’s my job to put forth proposals that provide a good return,” Rodio told the commission. “The uncertainty of north Jersey casinos throws some uncertainty into what should be deployed.”
Rodio said he will come up with two business plans for the Taj Mahal: one that assumes there will not be casinos elsewhere in the state, and one that assumes there will be, according to the AP. He also did not rule out a lesser investment while the north Jersey issue plays out.
“I can’t say that with 100 percent certainty,” Rodio said. “If I can put forth something I can show him that shows whether I will get a return, he’s never said ‘no’ to us at the Tropicana when we’ve come to him with something like that.”
Icahn faced a similar situation with the Taj when he acquired Atlantic City’s Tropicana in 2010, Rodio said.
“The place had just come out of bankruptcy, employee morale was horrible and the customer base was shrinking,” he recalled. “All those things are happening now at the Taj Mahal.”
Icahn is also still embroiled in a battle with city casino workers unions over health benefits at the casino. During bankruptcy proceedings, a court ruled that then owner Trump Entertainment could terminate union health benefits.
That brought out steep opposition from Atlantic City’s main casino workers union—Unite HERE of Local 54—which appealed the decision. However, those appeals have been unsuccessful and the union announced last week that it intends to appeal the matter to the U.S. Supreme Court.
