Icahn Sticks By Casino Offer

Oct 15 2014 | 9:23am ET

Carl Icahn is ready to proceed with a deal to take over an ailing Atlantic City, N.J., casino even if its employees go on strike, his lawyer told a bankruptcy court judge yesterday.

Icahn has pledged $100 million for the Trump Taj Mahal—provided that Trump Entertainment Resorts can cancel its contract with its union and wins $175 million in concessions from state and local governments. U.S. Bankruptcy Judge Kevin Gross said he will rule on the union contract on Friday.

At a hearing yesterday, Gross expressed concern that he has “no binding agreement from the Icahn entities that they will proceed,” adding, “I don’t have any comfort at that end.” But Icahn’s lawyers said that “even if the rejection of the contract causes the union to strike and there’s labor strife,” Icahn, Trump Entertainments largest creditor, would move ahead with the plan to save the Taj Mahal.

Without a deal, Trump warned, the Taj could become the fifth Atlantic City casino to close its doors this year. Trump’s lawyer, Kristopher Hansen, warned that the contract needed to be junked “to save 3,000 jobs. We need it to keep Atlantic City alive.”

The union has rejected a proposal that would see its members pay more for health insurance and cut pension benefits. There is also no guarantee that the government concessions sought by Icahn will pan out.

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