American real estate magnate Donald Trump's casino group, Trump Entertainment Resorts, is expected to file for bankruptcy protection Tuesday, the Wall Street Journal reported.
A company placed in Chapter 11 can continue to operate, but it must present to the court a reorganization plan and open itself to court supervision.
The filing would mark the third appearance in bankruptcy court for the company, which operates the Trump Taj Mahal Casino Resort and Trump Plaza Hotel & Casino in Atlantic City, New Jersey. It is struggling under 1.7 billion dollars in debt.
The company, which had 960 million dollars in sales last year, most recently emerged from bankruptcy in 2005.
The decision to seek protection was reached following months of negotiations between Trump and his casinos' bondholders. Trump resigned as chairman of the board Friday saying he disagreed with the bondholders' decision to seek an involuntary bankruptcy proceeding.
"These are very tough times in Atlantic City," Trump, who owns 28 percent of the company's stock, said in a statement according to the Journal.
"Almost every company is in serious financial trouble," he added. "Despite this, I will be watching closely and at some point in the future, I hope to return."
The US casino industry has been rocked in recent months as Americans have cut back substantially on casino visits and spending in the midst of the worst economic crisis in generations.
Atlantic City posted its largest drop in gambling revenue in its history in December, plunging 18.7 percent from a year earlier, the Journal reported.
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