updated 7/2/2007 2:39:14 PM ET 2007-07-02T18:39:14

Donald Trump knows the art of the deal. But he won’t be making one for his three New Jersey casinos.

The company that bears the flamboyant real estate mogul’s name had been up for sale for several months. But Trump Entertainment Resorts announced Monday it is not likely to be sold, sending shares of the company plummeting 18 percent.

The operator of three Atlantic City casinos said its board believed that none of the “indications of interest” met its expectations.

“Now we will continue as we have to focus on our strategic operating plan, which has produced strong results for us,” said company spokesman Tom Hickey.

That plan stresses reducing costs and attracting more big-stake gamblers to the company’s three casinos, rather than seeking more players.

The company is building a new 786-room hotel tower at the Trump Taj Mahal Casino Resort, its largest casino, which is due to open next summer.

Trump Entertainment was in talks with a group led by former Atlantic City casino executive Dennis Gomes and real estate developer Morris Bailey about a possible sale of the casinos.

Hickey said the Gomes group submitted a formal bid for the company, but would not discuss specifics, including why it was rejected. He would not say how many other interested parties there were.

New York-based fund manager Dune Capital Management LP, which is run by former Goldman Sachs & Co. executives, was also said to be a possible bidder.

Robert LaFleur, a casino analyst with Susquehanna International Group, said financial markets have become skittish in recent weeks about financing buyouts, particularly in a market as challenging as Atlantic City.

Analysts for Bear Sterns & Co. wrote that the failure to reach a deal “speaks to the fundamental problems inherent in Trump’s properties at present and the difficult operating environment in Atlantic City.”

“We do find it telling that a deal could not be completed despite the 30 percent decrease in shares since” the company was put up for sale in March.

The company has about $1.4 billion in debt that was expected to make any sale difficult.

KeyBanc Capital Markets analysts Dennis Forst and Charles Suh wrote that Trump’s best options now appear to be selling off casinos one at a time to “regional operators looking for a flagship destination.”

They wrote that potential buyers were rumored to be discussing share prices as high the low $20-range before talks ended.

Goldman Sachs downgraded Trump stock to neutral.

Shares of Trump Entertainment Resorts fell $2.27, more than 18 percent, to $10.31 Monday.

In addition to the Taj Mahal, the company operates the Trump Marina Hotel Casino and the Trump Plaza Hotel and Casino. All three were recently granted new five-year operating licenses by the New Jersey Casino Control Commission, which expressed skepticism about rosy financial projections the company made for the next three years.

The company, like all 11 Atlantic City casinos, has been hurt by competition from slots parlors in Pennsylvania and New York, as well as the implementation of a partial smoking ban in mid-April.

Trump will face further competition in coming years from two new large casinos nearby on the Boardwalk.

Also in the planning stages is a third smaller “boutique” casino to be built by Curtis Bashaw, the former chairman of New Jersey Casino Reinvestment Development Authority, and Wally Barr, the former chief executive officer of Caesar’s Entertainment.

© 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


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