Yesterday Trump Entertainment Resorts in the USA and Rank Group in the UK published first-quarter results. Both companies recently have been the subject of speculation about possible takeover or sale. They appeared prime targets in a time of private equity buyouts and consolidation in the gaming industry. Now analysts are revising those opinions, declaring that both Trump and Rank look less appetising.

The Rank results showed an overall improvement although the company is closing some bingo operations before the smoking ban in England takes effect. Profits have been hit at the clubs in Scotland, where a ban has been in effect for just over a year. It is not the Rank results that are causing a rethink on its suitability as a target for takeover; it is the new tax regime affecting gaming operators, particularly for casinos.

Trump reduced its chances for a sale following failure to reach Wall Street estimates for first-quarter profits. In March the company hired Merrill Lynch to seek possible buyers but there seems to have been little interest so far. A smoking ban in Atlantic City, home to the three Trump properties, is having an effect there also. Competition from Pennsylvania is another factor taking its toll on the AC market. Trump shares have fallen over 34% since last November. (E-05.04.07)

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