Citing competition and the recent economic meltdown, Trump Entertainment will miss it's $53.1 million scheduled payment on it's 8.5% senior secured notes scheduled due 2015 in order to maintain required liquidity.
Donald Trump is the non-executive chairman and the largest shareholder of Trump Entertainment. Trump Entertainment owns and operates three Atlantic Casinos, The Trump Marina, Trump Taj Mahal and the Trump Plaza on the Boardwalk.
The company has about $1.25 billion in notes currently outstanding. In a statement Friday, Trump Entertainment said, "that it has a 30-day grace period to pay up and will meanwhile seek talks with its lenders to revamp its capital structure and improve its liquidity."
If they fail to make the payment in within the 30 day grace period, holders of a quarter of the notes and lenders could accelerate the maturities of those obligations.
If things looked like they couldn't get worse for the Donald, he is being sued by Deutsche Bank in a New York court for a $40-million personal guarantee he made to help get financing for the 92-story Chicago high-rise that is currently in development.
Deutsche filed the suit Friday, charging that Trump defaulted on the loan earlier this month by not paying off $334.2 million due to Deutsche Bank.
This after Trump filed suit accusing Deutsche Bank of denying extension of a Nov. 7 maturity date for a $640-million loan.
Trump is claiming the lenders are harming condo-hotel unit sales and that a "force majeure" clause in the loan agreement applies, since the world financial crisis is an extraordinary event that permits a loan extension.
Oh boy...
Sunday, November 30, 2008
Friday, November 28, 2008
Airlines Have Nice Day on Wall Street as Crude Oil Drops 5%
It was a good day for the airline industry on Wall Street as crude oil dropped 5% due to speculation the Organization of Petroleum Exporting Countries could wait until December before slowing down production.
The AMEX Airline Index climbed up 3.2% to 20.54 points. 12 of the 13 companies listed in the AMEX Airline Index were up on the day.
The big winners were Brazil's Gol Linhas up 11% to $3.92, and Delta Air up 4.6% to $8.81.
The Markets closed early today at 1 p.m. E.T.
The AMEX Airline Index climbed up 3.2% to 20.54 points. 12 of the 13 companies listed in the AMEX Airline Index were up on the day.
The big winners were Brazil's Gol Linhas up 11% to $3.92, and Delta Air up 4.6% to $8.81.
The Markets closed early today at 1 p.m. E.T.
Thursday, November 27, 2008
Former UBS Executives Give Back $58 Million in Bonuses
A Statement was released today by Chairman Peter Kurer during a UBS shareholders meeting to vote on the bank's plan to accept government aid. In his statement Kurer said, "I would very much like to see more bonuses waived or returned in the interest of the bank. I am therefore continuing to hold discussions on the topic."
The exec's who have refused or returned bonuses is former CEO Peter Wuffli (12 Million Franc), the ex-chairman Marcel Ospel and former board members Stephan Haeringer and Marco Suter, have either returned or refused an additional 33 million francs.
Other former executives not mentioned have given up a further 22 million francs, Kurer said in his statement.
In a concession to shareholders Kurer also said the bank will allow another investigation into its losses and the role of former executives, including whether it should take legal action against any individuals.
Earlier reports from both UBS and the Swiss Federal Banking Commission found no evidence of individual breaches of duty by any current or previous senior executives, Kurer added.
"There is currently no actual or legal evidence that would lead one to believe a lawsuit regarding responsibility would be successful against former or present senior executives," he said.
Shares of UBS rose 3% in midday trading.
The exec's who have refused or returned bonuses is former CEO Peter Wuffli (12 Million Franc), the ex-chairman Marcel Ospel and former board members Stephan Haeringer and Marco Suter, have either returned or refused an additional 33 million francs.
Other former executives not mentioned have given up a further 22 million francs, Kurer said in his statement.
In a concession to shareholders Kurer also said the bank will allow another investigation into its losses and the role of former executives, including whether it should take legal action against any individuals.
Earlier reports from both UBS and the Swiss Federal Banking Commission found no evidence of individual breaches of duty by any current or previous senior executives, Kurer added.
"There is currently no actual or legal evidence that would lead one to believe a lawsuit regarding responsibility would be successful against former or present senior executives," he said.
Shares of UBS rose 3% in midday trading.
Wednesday, November 26, 2008
Borders' shares down 40% to 68 cents - Management Not Going to Sell to Eager Buyers
It was not a good day for Borders Group Bookstores. After reported massive losses and dwindling sales the company learned they would be kicked out of the S&P MidCap 400. After all this, they announced they are not even contemplating a sale offer from Pershing Square Capital Management.
After the close of the market Borders announced a third quarter loss of $172.2 million, which equates to $2.85 a share. This time last year they were reporting a loss of $40 million, or 68 cents a share.
Standard & Poor's announced that since Borders' market capitalization had fallen to around a tenth of its requirement, the company will be replaced by precision instrument maker Mettler-Toledo International.
Borders' also announced that it has updated its "strategic alternatives process" which have included the sale of company and/or certain arms such as Paperchase Products. But according to Borders' the sale is now off the table. And this was Borders' decision not Pershings evidently.
The company said in a statement, "With respect to the sale of the company, management is no longer contemplating a transaction."
I guess this is why I am a blogger that has a following of 6 people and not the CEO of a major market Bookseller. But I would be at least entertaining the idea of selling my sinking ship to enthusiastic private equity bidders.
After the close of the market Borders announced a third quarter loss of $172.2 million, which equates to $2.85 a share. This time last year they were reporting a loss of $40 million, or 68 cents a share.
Standard & Poor's announced that since Borders' market capitalization had fallen to around a tenth of its requirement, the company will be replaced by precision instrument maker Mettler-Toledo International.
Borders' also announced that it has updated its "strategic alternatives process" which have included the sale of company and/or certain arms such as Paperchase Products. But according to Borders' the sale is now off the table. And this was Borders' decision not Pershings evidently.
The company said in a statement, "With respect to the sale of the company, management is no longer contemplating a transaction."
I guess this is why I am a blogger that has a following of 6 people and not the CEO of a major market Bookseller. But I would be at least entertaining the idea of selling my sinking ship to enthusiastic private equity bidders.
Tuesday, November 25, 2008
Feds Unveil Yet Another Super Cool Plan
This morning Treasury Secretary Henry Paulson introduced a pair of new programs that will give $800 Billion to help unfreeze the consumer debt market. Mr. Paulson calls this "vital to supporting the economy."
Paulson said in a statement this morning that consumer debt such as credit cards, auto loans and student loans essentially came to a halt in October. These new programs are aimed to get lending back to more normal levels.
Paulson said all the government programs have been aimed at supporting the lending that is vital to the economy.
This whole situation reminds me of the Thanksgiving Day pick-up football games we used to play back when I was a kid. My older brother who played all-time quarterback would bring us into a tight huddle and detail out this genius play which we were going to execute with fine precision. I would cut right, then left, then run for 20 yards, button-hook back and he would provide with a perfect pass right on the numbers. Without fail, my brother would call hike and then immediately abandon the long thought out plan and just run with the ball.
Mr. Paulson is just running with the ball.
Paulson said in a statement this morning that consumer debt such as credit cards, auto loans and student loans essentially came to a halt in October. These new programs are aimed to get lending back to more normal levels.
Paulson said all the government programs have been aimed at supporting the lending that is vital to the economy.
This whole situation reminds me of the Thanksgiving Day pick-up football games we used to play back when I was a kid. My older brother who played all-time quarterback would bring us into a tight huddle and detail out this genius play which we were going to execute with fine precision. I would cut right, then left, then run for 20 yards, button-hook back and he would provide with a perfect pass right on the numbers. Without fail, my brother would call hike and then immediately abandon the long thought out plan and just run with the ball.
Mr. Paulson is just running with the ball.
Monday, November 24, 2008
Government Agrees to Become CitiGroup's Largest Shareholder
Citigroup shares have soured this morning to more than 60% after federal officials agreed to a $326 billion rescue. The government will invest $20 billion directly to Citigroup and will guarantee up to $306 billion of Citi's troubled assets. The deal will give the government control over dividend limits and executive bonuses.
This is the first time the government has absorbed bad assets rather than inject money directly into financials.
This also makes the US government the largest shareholder of the failing bank at a 7.8% stake, just behind Saudi Prince Alwaleed bin Talal at 5% and the government of Abu Dhabi at 4.9%
It's crazy to think that at this exact time a year ago, the stock market valued Citi at $180 billion. Today its market capitalization stands at $20 billion and its share price has shriveled to just $3.75, a 16-year low.
This rushed design was put together this weekend with intensive negotiations involving the Treasury, the Federal Reserve and the Federal Deposit Insurance Corp.
This is the first time the government has absorbed bad assets rather than inject money directly into financials.
This also makes the US government the largest shareholder of the failing bank at a 7.8% stake, just behind Saudi Prince Alwaleed bin Talal at 5% and the government of Abu Dhabi at 4.9%
It's crazy to think that at this exact time a year ago, the stock market valued Citi at $180 billion. Today its market capitalization stands at $20 billion and its share price has shriveled to just $3.75, a 16-year low.
This rushed design was put together this weekend with intensive negotiations involving the Treasury, the Federal Reserve and the Federal Deposit Insurance Corp.
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