ROANOKE TIMES 

                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: TUESDAY, June 5, 1990                   TAG: 9006050352
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A1   EDITION: METRO 
SOURCE: The Washington Post
DATELINE: NEW YORK                                LENGTH: Medium

TRUMP, BANKS SEEK CASH SOLUTION

Donald J. Trump, the real estate mogul whose name has become a synonym for flamboyant wealth and self-promotion, is now caught in a financial vise that could force him to dismantle his empire by selling assets to repay the money he owes to junk bond holders and big New York banks, according to bankers and Wall Street analysts.

In response to news reports that Trump spent much of last week in serious negotiations with his principal bank lenders in an effort to find a solution to his cash crunch, prices of Trump bonds plunged by as much as 15 percent Monday on the open market.

The bonds were floated in recent years to finance construction of his three hotel-casinos in Atlantic City, N.J., which, according to some analysts, are not generating sufficient revenue to service the interest payments on those bonds. A number of contractors working on the lavish new Taj Mahal casino allege that Trump is $50 million behind in his payments to them.

Several of Trump's major borrowings fall due June 15, which is shaping up as a test day for his financial condition, and a failure to make good on some of these obligations could force Trump to file for protection of the federal bankruptcy court for one or more of his projects.

"June 15 obviously is a key day," said an analyst who follows Trump junk bonds for a major Wall Street investment banking firm.

A banker at one of the major banks lending to Trump disputed reports the real estate developer was on the brink of a full-scale financial meltdown. "He's stretched pretty thin, but he's not yet close to bankruptcy," the banker said.

Trump has fallen victim to a slumping real estate market, very rapid expansion and his own strong appetite for taking on debt to finance acquisitions of glamourous new properties, which include the casinos, the former Eastern Air Lines Shuttle and Manhattan's Trump Tower and Park Plaza Hotel.

Although rumblings of his financial difficulties have circulated for months in the financial and real estate communities, Trump had been eager to return reporters calls and appear on television talk shows to dismiss the rumors as malicious gossip. But Monday, Trump was uncharacteristically silent. Calls to the Trump Organization were referred to Trump's personal publicist, Howard Rubenstein, who confirmed that Trump was holding meetings with "major banks."

"We are confident we will arrive at a mutually beneficial solution," the statement said. 


 by CNB