Donald Trump has formed a bold new partnership with New York hedge-fund manager Marc Lasry’s Avenue Capital, to operate an online poker site. This news, coming from Bloomberg, describes the partnership between Trump Entertainment Resorts Inc. and Lasry Avenue Capital Group as contingent upon poker legislation passing in the United States between now and May 2012, with the option of an extension.
In the deal, the Trump brand name and gambling licenses will be used to promote this new poker site, while Lasry’s firm Avenue Capital will provide the capital. According to Ivanka Trump, the 29 year old daughter of the famous mogul, “(Online poker legislation) is just a matter of time. It would be a tremendous source of taxable revenue for states or the federal government and an enormous generator of jobs.”
Ivanka Trump serves as the executive vice president of development and acquisitions for the Trump Organization. Elaborating on the potential of the partnership, she went on, “In terms of the internet, brand is essential toward attracting players, the Trump brand would be the most powerful one in this space (online poker).”
The filing of this partnership was submitted October 14th and states that Trump Entertainment, which Avenue Capital took control of last year, would own 10% of the venture, with unknown percentages held by Trump himself and Lasry’s $12 Billion hedge fund. Trump Entertainment has had financial difficulties in recent years, including two bankruptcies, the most recent of which was in July 2010. Trump Entertainment Resorts still controls two Atlantic City casinos though, the Trump Taj Mahaj, and the Trump Plaza.
Donald Trump gave his official statement on the deal, “We think we have the hottest brand there is, the Trump brand, my personal brand.” He continued, “We think it’s going to do phenomenally well.”
Time and time again, Donald Trump has shown his genius for branding, whether through his famous Trump casinos, real estate projects, or his television show The Apprentice. With the structure of this online poker site deal, Trump gets to enter the American online poker market when it reopens with little to no risk of his own capital. Furthermore, the Trump-Avenue Capital deal is good news for online poker, because when Trump gets involved, headlines are sure to follow. With years of lobbying experience in Washington, the more big name players lend their name and cause to the regulation of online poker, the sooner it is likely to happen.
In March of this year, pre-Black Friday, it made huge news when Steve Wynn, owner of Wynn Resorts, made a deal with PokerStars to join forces upon the regulation of online poker. April 15th, 2011, the Department of Justice, shut down all major poker sites in the United States, claiming them illegal. Subsequently, the PokerStars/Wynn deal was rendered null and void.
Now with this new partnership between Trump and Lasry, it shows that the major American casino organizations are renewing interest in online poker and positioning themselves to be ready in case online poker legislation begins its push through governmental channels.
It is unknown at this time what exactly the name of the new poker site will be, though it’s expected to have the same branding as Trump casinos. If poker is regulated in the United States, a huge marketing campaign is expected, telling of the site’s promotions, rake structure, and games offered. Under the current agreement, both Trump Entertainment and Avenue Capital are locked into a non-compete clause, keeping them bound to the terms of the deal until at least May 2012.