Icahn says Taj Mahal purchase is 'a bad investment for me;' urges union acquiescence

Associated Press

Billionaire Carl Icahn says buying Atlantic City's Trump Taj Mahal casino would be "a bad investment for me."

But in a letter Tuesday to Bob McDevitt, the president of its main union, Icahn says he's willing to do it anyway to save the casino's 3,000 jobs.

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Icahn reiterated his call for Local 54 of the Unite-HERE union to drop its appeal of a court order dissolving the union contract and canceling health care and pension benefits for workers. Trump Entertainment Resorts, which Icahn would acquire, has offered to restore workers' health insurance for two years and contribute to a new pension plan — an offer the union has yet to accept.

"Bob, as you know, this is a bad investment for me at this time, evidenced by the fact that no one else is willing to invest even a dime," Icahn wrote. "I'm amazed that the union is unwilling to agree to a company proposal that restores two years of health care, provides a new pension, keeps the Taj open and saves 3,000 jobs — basically ALL of the things that you and Senator Sweeney have asked for — if you just withdraw the appeal and give us labor peace."

Icahn would swap the $286 million in Trump Entertainment debt he owns for ownership of the company and would invest $100 million into it. But that deal is contingent on obtaining significant tax breaks from state and local governments — a demand rejected by state Senate President Steve Sweeney and Atlantic City Mayor Don Guardian.

McDevitt declined to comment on the letter, which was the latest salvo in a public tug of war between the billionaire investor and the pugnacious union leader.

The union also objects to other cost-cutting measures the company is imposing on its workers, including the elimination of paid meal breaks, the right to hire subcontractors to do some work performed by the union, and increased daily room-cleaning quotas for housekeepers — all of which are likely to be sought by the city's other seven casinos as well.

The Taj Mahal is scheduled to close Dec. 12.

"As you know, it's impossible for me to invest in the Taj Mahal while the appeal is pending, and even if you win the appeal, all it will do is ensure that the Taj Mahal closes," Icahn wrote to McDevitt. "Do you really want your legacy, and that of Local 54, to be defined by closing the Taj and putting 3,000 people out of work unnecessarily? There is no time left to negotiate, and that is why the company and I have put everything on the table."

The company has not given the union a deadline to agree to withdraw its appeal, but began accelerating preparations this week to close the casino by Dec. 12.

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Wayne Parry can be reached at http://twitter.com/WayneParryAC