Trump Entertainment Resorts Inc( TRMPQ )

 

Icahn Reminds Shareholders That Excess Liquidity, Not Fundamentals, Are  Driving Asset Prices
20 April 2010

ST. LOUIS (Alpha Found) — Veteran activist investor Carl Icahn joined  Steve Wynn in warning that the US government’s stimulus plans are akin  to a buy-now-pay-later policy.

In a quarterly letter sent to investors in mid February covering the  fourth quarter of 2009, Icahn offered “perspectives” on the extreme  contrast between 2008 and 2009. “2008 was defined by an utter lack of  liquidity, while 2009 came to be a year of excess liquidity,” he wrote.

And, as always, it’s a case of follow the yield. And yield is going to  be hard to come by, says Icahn, noting, “the days of easy yield in the  credit markets have come and gone.”

Icahn and his partners have contributed $400 million to the Icahn  Capital funds on 1 February 2010.

“With cash yielding close to nothing last year, yield-hungry investors  felt that they could no longer sit on the sidelines. They plunged head  first into both equity and credit, aggressively driving up the markets.”

Stressing that he doesn’t see fundamental justification for the market  rebound, Icahn warns his investors that a double-dip recession may be at  hand.

He’s waiting for employment to pick up before he’s satisfied that  housing and the overall market can mend as consumers and companies  continue to deleverage.

Icahn Capital has just one fifth of its capital exposed to equities  according to the quarterly report. Assets under management were $5.8  billion at the start of 2010. The company appears set to maintain a  defensive posture with most of its new funds being allocated to credit.

Icahn, like Wynn, warned that government has little idea what it has  unleashed. “As a country, it would be foolish for us to continue to  print money and run up the deficit while turning a blind eye to the  potential consequences. I can’t say whether we’re in for full blown  inflation or merely a weak economy for a prolonged period of time, but I  do feel sure that there will be consequences,” he wrote.

Icahn is not sitting the recession out though. He tells investors he’ll  be feeding on overleveraged companies using his firm’s specialist  knowledge of distressed debt, distressed for control situations, and  bankruptcy processes.

However, Icahn lost the bankruptcy roulette involving Trump  Entertainment Resorts. Competing bondholders won the right last week to  keep the firm running whilst they prepare a rights offering related to a  $225 million takeover of the Trump casinos.

The firm’s flexibility will allow it to be “agnostic” in the securities  it deals in, which should give it some advantage in the current market.  The company is eyeing the merger and acquisition frontier for additional  opportunities. Icahn is especially interested in biotech, noting that  “Big Pharma is notoriously cash-rich.”

Biotech holdings accounted for half of Icahn’s total long equity  exposure at the end of last year.

Icahn is playing hard in the pharma space at the moment with a proxy  battle against Genzyme [GENZ], and one set aside against Biogen Idec  [BIIB] after winning a third seat on its board.

Biogen is one of Icahn Capital’s core holdings along with Motorola  [MOT], CIT Group [CIT] and Amylin [AMLN].

Icahn has succeeded in closing his hostile offer for Lion’s Gate  Entertainment [LGF] after raising the takeover price to $7 per share  from $6.

http://alphafound.wordpress.com/2010/04/20/icahn-reminds-sha…

 

 

 

http://phx.corporate-ir.net/phoenix.zhtml?c=71730&p=irol-IRHome  

Magna Entertainment reorganization plan subject to court confirmation hearing
By Randall Chase, AP

April 20th, 2010

Magna confirmation hearing begins

WILMINGTON, Del. — A bankruptcy judge has begun a hearing on whether to confirm horse track owner Magna Entertainment Corp.’s reorganization plan by rejecting a shareholder request to appoint an independent examiner in the case.

The judge on Tuesday also denied a request to appoint an official committee of equity holders, saying Magna shareholders waited too long to take action.

The shareholders are challenging how the reorganization plan values Magna and say the plan allows parent company MI Developments to acquire Magna assets to the detriment of other creditors and remaining shareholders.

Magna filed a reorganization plan in February. It depends on settling a lawsuit in which its official creditors committee accused MI Developments of sham financial transactions leading th Magna’s bankruptcy.

http://blog.taragana.com/politics/2010/04/20/...mation-hearing-30073/