Real estate tycoon Donald Trump and an affiliate of Bank of Nevada will buy Trump Entertainment Resorts Inc for $100 million, the bankrupt casino operator said, sending its shares up more than 79 percent.

Donald Trump and Bank of Nevada's BNAC affiliate will emerge as owners of the privately held company, which filed for Chapter 11 protection in February. The deal still needs approval from the bankruptcy court, Trump Entertainment said in a statement late on Monday.

We want to invest a lot of money in the company, Donald Trump said in an interview on CNBC. We're starting off with a $100 million, and it could be well above that as time goes by.

Trump, the casino operator's founder and one-time chairman, resigned in February when bondholders demanded a Chapter 11 filing after the company missed a $53.1 million bond interest payment. The billionaire said the company had borne his name, but not performed to his standards.

Under the reorganization plan, Trump Entertainment received an eight-year extension on the maturity period of about $486 million in debt, to December 2020, according to a Tuesday securities filing. The interest rate on the debt was also reduced.

Holders of that debt are expected to see a 94 percent recovery on their investment.

The company said there would be no recovery for holders of its 8.5 percent senior secured notes due 2015. Holders of those notes were due $1.25 billion. Holders of unsecured claims and equity will also see no return on their investment.

The plan has the approval of Trump Entertainment's management and board, the company said.

My daughter Ivanka and I will work tirelessly to make this company great again, Donald Trump said in a statement. As I have done in the past, we will make Atlantic City hot once more.

TRUMP MARINA DEAL IN FOCUS

News of the deal comes a time of great distress for the casino industry in Atlantic City, New Jersey, where the company has three properties: the Trump Taj Mahal, Trump Plaza and Trump Marina.

In the filing, the company said its financial advisor, Lazard, pinned the value of its three Atlantic City casinos at $428 million to $488 million.

A deal to sell the Trump Marina property to Coastal Marina LLC collapsed in early June. Lazard valued that property at about $24 million.

Since the deal failed, Coastal submitted nonbinding indications of interest in the property on two separate occasions, Trump Entertainment said in the filing.

Neither proposal was acceptable, the company said, adding that it continued to explore with Coastal their interest in pursuing a purchase of the Marina property.

Gaming revenues in the city are in their third year of decline amid increasing competition and reduced consumer spending, according to data compiled by the New Jersey Casino Control Commission.

When you look at the debt of some of the casino companies, they have no choice but to totally restructure their debt, Trump told CNBC.

Trump Entertainment shares were up 11 cents, or 79.3 percent, at 26 cents in morning pink sheet trading.

(Reporting by Santosh Nadgir in Bangalore and Deepa Seetharaman in New York; Editing by Valerie Lee and Lisa Von Ahn)

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