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Hilton Hotels May Reapply for Casino in Atlantic City

TIMES STAFF WRITER

Hilton Hotels Chairman Barron Hilton said Thursday that his company may again try to open a casino in Atlantic City, N.J., and might even buy back what is now the Trump Castle Hotel & Casino, owned by New York developer Donald J. Trump.

Hilton’s remarks come five years after Hilton Hotels first tried to enter the gaming market in Atlantic City only to have its application rejected by the New Jersey Casino Control Commission in a controversial move that left Hilton executives stunned, angry and humiliated.

“It’s something we’ll watch,” Barron Hilton said after the company’s annual meeting in Beverly Hills, when reporters queried him about a possible return to Atlantic City. “We’re looking at it.”

He also confirmed his interest in Trump Castle, and “if not the Trump Castle, maybe another” of the casinos in the New Jersey resort town. Atlantic City has 12 casino hotels, several of which are in financial trouble and are among the properties Barron Hilton is said to be evaluating.

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Barron Hilton declined to say if he has already talked to Trump, who could not be reached for comment.

Hilton also reiterated that the company, which had been put on the auction block last summer and withdrawn in March, is not for sale.

Though Hilton Hotels is best known as a lodging company, with about 270 inns nationwide, it derives a major chunk of its profit from gambling. The company owns three casinos in Nevada and plans to open a fourth in Laughlin this summer.

If the company were to buy Trump Castle, the sale would be doused in irony. Trump bought the property from Hilton Hotels in early 1985, shortly after the license denial. Hilton Hotels had already built the $320-million facility in anticipation that it would receive the gambling license.

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Hilton Hotels’ license application was rejected because the New Jersey commissioners were concerned about the firm’s business connections, including its long ties to reputed mob lawyer Sidney Korshak. Hilton Hotels severed its ties with Korshak before the licensing hearings, but it was not soon enough to suit some regulators.

Much has changed in five years, however. Atlantic City’s casino industry has fallen on hard times in the past year, and regulators are groping for ways to inject money and new life into the decayed resort town.

In addition, the state commission has experienced a near-total turnover of its members since 1985. The commissioners who voted against the Hilton application have left the agency, and one of the new commissioners met recently with Barron Hilton in an attempt to lure his company back to town.

“I can’t tell you what the commission would do, but the regulatory climate has certainly changed,” said Tom Flynn, a commission spokesman. “Put it this way: There are no doors closed.”

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One casino industry insider, who asked not to be named, said Trump Castle is a logical candidate for a sale since Trump already owns the Trump Plaza Hotel & Casino and the Taj Mahal Hotel & Casino.

It would also dovetail with Trump’s recent public declaration that he wants to raise cash by selling assets and refinancing properties, though Trump has said in a Los Angeles Times interview that he did not intend to sell or refinance his casinos.

The Taj, which cost more than $1 billion and opened April 2, had gambling winnings of more than $34 million in April, the best in town. But, according to Atlantic City Action, an industry newsletter, Trump Castle fell to ninth place last month with only $18.5 million in winnings, nearly 12% less than in April, 1989.


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