The foundering Trump Entertainment Resorts is finally acknowledging it’s been in a heap of financial trouble and is looking to explore options to get out of the mess it’s in. That includes the possibility of dumping the entire company outright to the highest bidder.

Though The Donald has become a dominant personality in the world of celebrities, his casino business has always been lagging. Currently the company has three casinos all located in Atlantic City: Trump Plaza, Trump Taj Mahal and Trump Marina. Several years ago he shuttered the failing Trump World’s Fair Casino, which has since been demolished. Trump Plaza and Trump Marina are usually the worst performers in pulling in revenue and are 10th and 11th in revenue of the 11 casino resorts in the City by the Sea.

While Donald Trump is chairman of the company, he is not involved in the day to day operations of the company. He was removed from that position nearly three years ago when the company’s severe financial troubles sent it into bankruptcy. Trump Entertainment filed for Chapter 11 bankruptcy protection in November 2004 when the company couldn’t make payments on its $1.8 billion in debt. It had also sought bankruptcy protection several years before that.

Trump is still the company’s single largest stockholder. Its current leadership has managed to restructure the company’s debt to improve cash flow by reducing debt by nearly $600 million, but it’s still not pulling in enough revenue to be in the black.
Trump properties have consistently lost money, an aberration for the country’s second largest casino market. Additionally, Atlantic City has been experiencing a renaissance and until a couple of months ago was constantly posting month over month revenue record increases.

Now the company has hired Merrill Lynch to assist in trying to find a way to dig itself out of its hole. The group will explore new financing, how the company is structured, selling individual properties as well as the entire company. In recent months speculation has been swirling that The Donald would cut a deal with the father of modern Las Vegas, Steve Wynn, to develop a mega resort which would replace Trump Plaza.

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"The real question is whether Trump is in play," Adam Steinberg, an analyst with Morgan Joseph & Co., wrote in a research report Monday. "The answer is that virtually all casino companies, in this environment, can be had. "We believe Trump asked an investment bank to value the properties over the summer when speculation surfaced about a potential joint venture with Steve Wynn."  He noted potential buyers include Ameristar Casinos (NASDAQ: ASCA) and Penn National Gaming (NASDAQ: PENN).

On Friday, Trump Entertainment shares rose nearly 8 percent when rumors started spreading Trump is looking to get out of the casino business.

To compound matters, Trump has been unsuccessful in its bid to expand gaming operations to other jurisdictions. It tried unsuccessfully last year to get a gaming license in the burgeoning Pennsylvania market. However, the Philadelphia location it chose – the site of a former Tasty Kake factory – proved ill conceived to Pennsylvania’s Gaming Control Board. The Board chose to go with properties that would be centrally located downtown.

Additionally, Trump had entered into a land deal in Mississippi, to develop a potential casino. However, that market has been slow to rebound after being devastated during the summer of 2005 by Hurricane Katrina and is not proving to be a viable option at this time.

In Las Vegas he is currently building a condo-hotel across from Wynn Las Vegas, but it will contain no gambling element.

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