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NEWARK-Trump Hotels & Casino Resorts has finally made the long-awaited move to right its financial ship. Yesterday, the company’s affiliate, Trump Atlantic City Associates, filed for Chapter 11 in US Bankruptcy Court for the District of New Jersey here. The parent firm owns 99% of the affiliate.

The papers for the voluntary filing listed a total of $1.3 billion in debt and $1.5 billion in assets. The company’s biggest creditors, according to the papers, are Bear Stearns, the Bank of New York, JP Morgan Chase and Goldman Sachs. These and other creditors hold stakes in first mortgage notes that come due in two years.

The filing comes on the heels of an off-again, on-again reorganization plan that company officials hope will pay some bills, reduce the debt load, help revamp the company’s aging casino hotels properties and even allow it to expand into new markets. According to the filing, the plan that Trump will present to the court generally calls for bondholders to own two-thirds of the company. Donald Trump’s own personal stake would be cut by more than half, from 56% to 27%, but unlike an earlier version that would have reduced his executive role, the latest leaves him in charge as chairman and CEO.

A key element of the plan is a $500-million line of credit from Morgan Stanley, the filing explains. The proceeds, which will be secured by a first-priority lien on the company’s assets, will fund capital improvements and expansions to existing properties as well as investment in new markets, according to Scott Butera, Trump’s chief operating officer.

And the Dallas-based Beal Bank is providing $100 million in interim financing. Similarly secured by a lien on Trump’s properties, the money will be used to cover certain business costs, including capital expenditures, wages, trade and vendor contracts and leases.

The filing marks Trump Atlantic City’s second appearance in bankruptcy court. The previous filing came in 1992 after the company’s debt load reached the $1-billion mark.

The first priority this time around will be an overhaul of the company’s three Atlantic City properties, the Trump Taj Mahal, Trump Plaza and Trump Marina. All three are in need of serious work, according to industry officials, and all three have suffered from competition from the Borgata, as well as expansions by several other competing properties.

Besides the Atlantic City properties, Trump also owns the Trump Casino Hotel and a riverboat in Gary, IN. The firm also manages a Native American-owned casino in California. Company officials have also said they will target such markets as Las Vegas and Pennsylvania. The latter approved legislation earlier this year authorizing up to 61,000 slot machines at various locations statewide.

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