Donald Trump has a $490 million worry off his shoulders.
The casino mogul’s casino company last week priced its critical bond deal, completing the sale of $490 million notes, according to a Press of Atlantic City report.
Trump Hotels has been trying to get such a bond deal done since last spring because it doesn’t have the cash available to pay off $312 million in Trump Marina debt due in November.
"It feels terrific because the market is so brutal," Trump said. "I had to put in $30 million to show good faith. Without it, forget it ”” it couldn’t have happened."
The company sold $425 million of seven-year first-mortgage notes at a discount of 94.8 cents on the dollar and with an interest rate of 11.625 percent, giving investors an effective yield of 12.75 percent.
Trump will personally buy $15 million of equity in his company and buy $15 million of second-mortgage notes.
"I’m just glad he got it done because nobody likes to deal with a Chapter 11 (bankruptcy) filing," Lehman Brothers analyst Jane Pedreira said.
"I think it’s a fair deal for all the parties. This really is not a bad deal for him ”” remember, he was paying 15.5 percent (interest) on the senior notes. This gives him more time to weather any marketing pressure," she said.
"I also think it’s a decent deal for the bondholders because they’re also getting cash flow out of Indiana and cash flow out of Palm Springs," Pedreira said, referring to the Trump casinos in Gary, Ind., and Coachella, Calif.
Trump Hotels plans to formally close the bond sale on March 25, but must receive approval from the New Jersey Casino Control Commission. The group is scheduled to discuss the matter this week.
Get down, Greektown
Ford Field, home of the NFL Detroit Lions, is asking Greektown Casino to reduce the size of its property.
"There are no other structures of this scale nearby, and we’d like the designers to consider reducing its height," Ford Field GM Joan LeMahieu said in a letter nearly two weeks ago to the Detroit City Planning Commission.
Greektown is proposing to build a 29-story hotel complex in the downtown area as part of a $300 million upgrade.
The Detroit News reported that two-thirds of area gamblers heading to the permanent casino would exit Interstate 75, which could create even greater traffic problems.
Ford Field officials believe Greektown is squeezing onto seven acres in the heart of the city what MGM Grand Detroit and Motor City casinos are each doing on 25 acres outside of the downtown area.