Republican presidential nominee Donald Trump has received a huge amount of support during his bid for the presidency, as Trump supporters see him as a Washington outsider. However, with no political experience under his belt, Trump has been touting his business experience, particularly his negotiating prowess, as extremely useful to the American people.
Unfortunately for Trump, his opponents have had a field day with the four bankruptcies that Trump has on his track record. Benzinga took a closer look at Trump’s business background to understand what these bankruptcies were all about and dispel the myths behind Trump’s business career.
Anyone who has struggled with finances and considered or opted for bankruptcy is probably confused about how one person could declare bankruptcy four different times. In reality, Trump himself has never declared personal bankruptcy. Four of his businesses have declared Chapter 11 bankruptcy, which allows the businesses to keep operating after restructuring their debts.
This bankruptcy was the most financially devastating for Trump. He was forced to sell his 282-foot yacht, his Trump Shuttle airline and half his stake in Trump Taj Mahal.
This bankruptcy included Trump Plaza Hotel in New York, Trump Plaza Hotel and Casino and Trump Castle Casino Resort in Atlantic City. Trump surrendered half his stake in the New York Plaza to Citigroup Inc (NYSE: C).
After 12 years, Trump's next visit to bankruptcy court was again for a failing casino business. Trump forfeited majority control of his Atlantic City casinos and an Indiana riverboat to bondholders in exchange for shedding $500 million in debt.
This final Trump bankruptcy was the nail in the coffin for his venture into the casino business. Trump surrendered his board seat and gave up his remaining stake in the company during the proceedings.
Is Trump A Self-Made Success Story?
In reality, Trump seems to neither be the self-made billionaire that he proclaims to be nor the inept business failure that his opponents paint him as.
Trump has owned and been associated with dozens of businesses, many of which have failed. However, his Trump Organization real estate portfolio of hotels and golf courses seems to be a success, even though financial details about private companies are hard to come by.
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At the same time, Trump may not be the New York real estate mogul that he claims to be. Trump is not included among the top 10 real estate players in New York, and Forbes estimates his net worth at $4.5 billion, well short of the $10 billion he claims.
He also reportedly inherited roughly $40 million from his millionaire father back in 1974. In addition, Trump was able to benefit throughout his real estate career from the creditworthiness of his father’s name.
The reason why there are so many myths surrounding Trump is ironically due to what may be his greatest business strength of all: brand-building. Regardless of how you feel about Trump as the next U.S. president, he has certainly built a reputation for success.
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Disclosure: The author is long C.
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