Last month Carl Icahn joined banker Andy Beal in his battle to wrestle three casinos from Donald Trump and a group of creditors, and late last week, the billionaire upped the ante with an additional offer to commit another US $125 million to prop up Trump Entertainment Resorts Inc., which finds itself again in Chapter 11 territory.

Icahn made a deal to buy a majority of the outstanding first-lien bank debt from Beal to the tune of US $486 million, and following a new statement filed in the U.S. Bankruptcy Court, Icahn Partners has agreed to put up the new sum for the three properties: Trump Plaza Hotel and Casino, Trump Taj Mahal Casino Resort and Trump Marina Hotel Casino.

Trump Entertainment filed for Chapter 11 protection last February but has been struggling for several years, when had also found itself on the threshold of commercial demise. As time and again Trump came up with deals to take out the company from Chapter 11 with beneficial terms for the ailing business, this time, it seems that muscling off Icahn will be a C-11 filing too far.

According to Icahn’s proposal, US $45 million would be spent in immediate financing with a guarantee to provide another US $80 million if he fails to raise US $225 million from other investors through a rights offer. Icahn’s latest offer, which sticks a poke in the wheels of Trump’s offer to bondholders of US $225 million for the casinos, with a juicy 10% equity for the Donald in the new company. (E-01.04.10)

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