Donald Trump missed a deadline for making a $47.3 million interest payment but moved closer to a deal with investors threatening to force his Taj Mahal casino into bankruptcy court, an attorney said Friday.
The developer had been negotiating with Taj Mahal bondholders in an attempt to restructure his debts before the payment came due at midnight Thursday."There are several issues that are still left outstanding, several of them big ones, so I can't say that we have any agreement at this time," Robert Miller, an attorney for bondholders, told CBS Radio early Friday.
"But we've been working in good faith on both sides to try and narrow the issues, and we've made some progress."
CBS said negotiations would continue Friday.
Neither the Trump Organization nor representatives of casino bondholders returned calls to The Associated Press late Thursday and early Friday.
During the talks, the Taj Mahal bondholders had offered Trump more favorable terms on the $675 million in junk bonds in return for a big stake in the casino.
Bondholders had threatened to seek Chapter 11 bankruptcy for Atlantic City's biggest casino as early as Friday if terms couldn't be reached. Chapter 11 allows a business to continue operating under court supervision while it puts its finances in order.
Wilbur Ross, who represents 10 of the Taj Mahal's institutional investors, has said bankruptcy court would give investors a better deal than Trump. The bondholders have the first mortgage on the Taj Mahal, which places them ahead of its other creditors.
The Wall Street Journal reported Friday that a bankruptcy filing was a near certainty since Trump missed the payment. Under what is known as a pre-packaged bankruptcy, both sides could continue to negotiate even though the casino would technically be under court protection, it said.
The Taj Mahal opened on April 2 but has not been able to make the $1.3 million a day that analysts said it would need to break even.
Business in Atlantic City has slumped as the economy has weakened, putting pressure on all casinos in the New Jersey resort.
Trump's three casinos - the Taj Mahal, Trump Castle and Trump Plaza - all have high-yield junk bonds outstanding. The problems at the casinos and the depressed New York real estate market have left Trump short of cash.
The developer, who owes an estimated $2 billion to banks, has been negotiating with creditors since spring, trying to restructure his debt.