Many casinos in Atlantic City have been forced to close their doors in recent years, so it did not come as a huge surprise when Trump entertainment filed for bankruptcy for their Atlantic City casino.
While the drastic decline in revenue is all too common across the Atlantic City gaming landscape, the casino’s unsecured creditors are calling their bankruptcy a charade.
The unsecured creditors claim that the only vote Trump Entertainment is looking to achieve in their Chapter 11 bankruptcy plan is that of investor Carl Icahn.
MarketWatch says that Icahn stands to gain hundreds of million dollars in tax credits (aka. lessening his loss) with the bankruptcy.
The plan calls for the casino’s other unsecured creditors to receive nothing of the 13.5 million they are owed, but is designed to benefit Icahn in multiple ways. The plan would allow some of the debt owed to Icahn to be swapped for equity stake in a reorganized company, partially transferred to new debt.
Creditors also claim that that plan is void of many pertinent bankruptcy code requirements.