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In the good times it was thought that
PE owners
private equity companies had a licence to
21-year-old
print money; buying up flabby firms
to lose half
through huge debt deals, making them
tries for Trump
fitter and selling them on at huge profit
and with little risk. Risk there was,
in Gala debt
youthfulinterest
nonetheless, and PE is now paying. TRUMP ENTERTAINMENT RESORTS
winsomelosesome years, Gala Coral is labouring A 21-year-old investment
‘rescue deal’
GALACORAL under some £2.6bn chief in Maryland has said he
(E2.77bn) of debt, which the wants to buy a controlling
The consortium of investors recession, the smoking ban interest in Trump Enter-
that bought British casino, and higher gaming taxes have tainment Resorts, the oper- Buyers are now queuing
bingo and betting shop oper- all made difficult to service. ator of three Atlantic City up for Trump
ator Gala Coral in the biggest The closure of several casinos, which is currently
Entertainment Resorts
private equity deal in the UK unprofitable bingo halls has in the bankruptcy courts.
gambling sector’s history are helped strengthen the Artin Afsharjavan, the chief investment officer of New
to cut their interest in the accounts and the balance Century Investments, said the company had been following
company down to half in sheet and allowed the the fortunes of Trump since the end of 2008. He added:
return for the cancellation of company to continue to meet “Now is the time to make our move. We have assembled
more than half a billion its payments, however, its some the nation’s top turnaround talent to aid us if we get
pounds’ worth of debt, the ability to continue to do so in our way. Our partners are the people who see the true
British press has reported. the short to medium term potential of Atlantic City and want it to succeed.”
The three PE firms Can- has been a matter for Former owner Donald Trump and the company’s credi-
dover, Cinven and Permira concern. The deal, which is tors are competing to buy the company out of bankruptcy:
are in the closing stages of expected to have been New Century has said it is willing to become a partner with
discussions with a group of finalised before the end of either side and has up to $500m (E338m) to spend.
debt holders led by Interme- October, will see the However, Trump Entertainment Resorts has cast doubt on
diate Capital and Park Square company gain a little head- whether New Century has the money after a takeover
to offset £540m (E575m) of room and implement a new approach in February was inconclusive.
debt into shares. Having business plan that will see it The management is thought to favour selling the
changed hands among pay down a further £550m company to the holders of its $1.25bn (E846m) bonds for
Gala Coral’s owners are learning to lose private equity companies (E586m) of debt and £500m $175m (E118m). Donald Trump and his daughter Ivanka
several times in the last 12 (E533m) in interest. have offered $100m (E67.7m).
Lack of
interest
FOR SALE
stops MGM
Established &
debt swap
Proven Business
jamtoday
• Gaming Equipment Manufacturer/
MGM MIRAGE
Distributor
Casino operator MGM Mirage
• Based in Western Europe
terminated a debt-swap offer on certain
of its senior notes at the start of October
• 10 years of profitable trading
because not enough note holders were
• Located in Southern Spain since
tempted by the deal.
The company had offered to certain of
summer 2000
its institutional and international investors
• 10,000sq ft fully serviced premises
to swap some of MGM’s $782m (E529m)
worth of 8.5 per cent senior notes due
• Factory, workshops, storage,
next year for ten per cent senior notes
showroom, offices
due in 2016. The offer required a
minimum of $25m (E16.9m) worth of 2016
• Global client base
notes be issued in exchange for eligible
(Europe, Middle East, Africa, Asia,
2010 notes, however, by the time the
offer was withdrawn only notes worth a
Far East, Latin America)
yield of just over $10.7m (E7.2m) in 2016 • Fully licensed in several jurisdictions
had been tendered.
The offer was first made in August
• Multiple product lines
but was amended in September to (Tables, Furniture, Bespoke Layouts,
extend the expiration date and change
some terms.
Chips, Cards, Accessories)
• In-house design facilities and team
• Includes plant, equipment and
large stock holding
An excellent opportunity to acquire a ready-madell i i d d
European sales, manufacturing and distribution base
To receive a comprehensive sales prospectus
Email: gaming.equipment@hotmail.com
November 2009 • businessnews 79
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