Atlantic City – Donald Trump’s gaming empire may be the target of an investment fund that bought billionaire Carl Icahn’s Nevada casinos two months ago. Another potential buyer is a group that includes Dennis Gomes, a former Atlantic City gaming executive who once worked for Trump before the two had a falling out.

Whitehall Street Real Estate Funds, an affiliate of financial giant Goldman Sachs & Co., is expected to participate in a second round of bids for Trump Entertainment Resorts Inc., according to Wall Street analysts. Goldman Sachs spokesman Michael DuVally would neither confirm nor deny Tuesday that Whitehall is interested in Trump.

In April, Whitehall agreed to pay USD 1.3 billion for Icahn’s flagship Stratosphere Casino Hotel in Las Vegas, his two Arizona Charlie’s casinos in Las Vegas and the Aquarius Casino Resort in Laughlin, Nev. The Whitehall deal followed Icahn’s USD 250 million sale last year of the Sands Casino Hotel in Atlantic City to Pinnacle Entertainment Inc.

Trump Entertainment hired Merrill Lynch in March to help it explore strategic options, including the possible sale of the entire company or individual casinos. On May 17, Trump announced that it had received preliminary offers from potential suitors, although it didn’t disclose any names. Trump spokesman Tom Hickey declined to comment Tuesday on possible sale talks.

The bidding is now entering a second round, according to Wall Street analysts and the online financial news publication Debtwire.com. Whitehall and another investment group led by Gomes are said to be the front-runners. Blackstone Group, a New York-based private equity fund, is seen as another potential buyer.

Gomes has been searching for casino opportunities following a failed attempt last year by one of his partners, Matzel Development, to win a gaming license for a proposed Pennsylvania slots parlor in the Pocono Mountains.

Gaming executives said Gomes may be seeking financial backing from JEMB Realty Corp. of Manhattan to buy Trump Entertainment or one of its three casinos. JEMB was part of the Matzel development team for the proposed Pennsylvania slots parlor.

Gomes, who could not be reached for comment Tuesday, recently visited the Trump Taj Mahal Casino Resort, raising speculation that he is more interested in buying Trump Entertainment’s top property than the entire company. He served as the Taj Mahal’s president for four years in the 1990s, although he and Donald Trump parted ways in 1995.

Less than a month after leaving the Taj Mahal, Gomes took charge of the Tropicana casinos in Atlantic City and Las Vegas. Considered one of the gaming industry’s most imaginative executives, Gomes concocted some oddball promotions to distinguish Tropicana from its rivals.

Gomes was also credited with orchestrating Tropicana’s lavish USD 280 million retail and entertainment center, called The Quarter. Hailed as a groundbreaking project when it opened in late 2004, the Latin-themed Quarter brought Las Vegas-style nongaming attractions to Atlantic City.

However, Gomes left Tropicana in 2005 following a change in leadership at the casino’s then-parent company, Aztar Corp. Aztar agreed to sell its casinos in Atlantic City, Nevada and Indiana last year to privately held Columbia Sussex Corp. for USD 2.75 billion.

A buyout frenzy has gripped the casino industry in recent years, likely giving the money-losing Trump Entertainment hopes of cashing in big. Analysts, though, cautioned that Trump’s outdated casinos, heavy debt and restrictive bond covenants could thwart a sale. Extra competition from slot parlors in Pennsylvania and New York could also scare off potential Trump suitors.

Carlo Santarelli, a casino analyst for Bear, Stearns & Co. Inc., issued an investor note Tuesday characterizing the chances of a lucrative Trump buyout as remote. He speculated that a buyer may not want to pay a premium for Trump Entertainment’s stock based on the exorbitant capital costs needed to make the company’s aging casinos more competitive with their younger rivals.

“After careful review, we believe the hurdles involved in the transaction and the significant capital outlay required to generate returns for a potential buyer are simply too much to rationally expect a deal to occur near term at a premium to current levels,” Santarelli wrote.

Santarelli downgraded Trump Entertainment’s stock and dropped his estimates for the company’s 2007 and 2008 gross operating profits, citing an onslaught of competition from Pennsylvania and New York’s slot parlors.

According to Santarelli, Wall Street has been overly optimistic in its forecasts for Trump’s financial performance. He set a “fair value” target price for Trump Entertainment’s stock at USD 11 a share. In trading Tuesday, shares of Trump Entertainment closed down USD 1.12, or nearly 7 percent, to USD 14.94.