BIZ WATCH

By BERNARD BAUMOHL, STACY PERMAN AND BILL SAPORITO

HOW TRUMP TRUMPED TRUMP

Four months ago, when Donald Trump arranged for his publicly held Trump Hotels & Casino Resorts, Inc. to buy his privately held Trump's Castle casino in Atlantic City, New Jersey, for $490 million, shareholders howled that they had been taken by the less than self-effacing subject of Trump:The Art of the Deal to the tune of some $100 million. Trump Hotels stock dropped 30% over the following weeks. More bad news rolled in when a reported $600 million deal to sell half of the Castle to the London-based Rank Organization and transform it into a Hard Rock casino crapped out after a long negotiation.

Now it turns out that the Donald may have left some money on the table. Last week the public company agreed to sell 51% of Trump's Castle to the Los Angeles real estate firm Colony Capital for $125 million in cash. The deal values the property--to be rechristened Trump Marina--at $563 million and wipes $314 million in debt off its balance sheet. Says Nicholas Ribis, president and CEO of Trump Hotels: "[Donald] is vindicated, sure...It's a smart financial deal for Trump and financially for the company."

SETTING SUN FOR JAPANESE STOCKS Japan's economy purportedly grew fastest of all the industrial countries last year, had no inflation and near zero interest rates. Ideal ingredients for a booming stock market. Yet Japan's stock market is rolling like a snowball down Mount Fuji. The Nikkei 225 index dropped more than 10% so far this year, to 17689,and some 55% off its peak of 38915, reached in 1989.

Why are Japan's equities taking such a beating when its mighty economy is on the rebound? Largely because few investors are convinced the recovery is real. Japan's financial system is an absolute mess, still hobbled by hundreds of billions of dollars in bad loans triggered by the collapse of the real estate market. Moreover, instead of promoting growth, officials have taken the bizarre step of boosting taxes this year. It's little wonder that the government now sees the economy growing 1.9% in 1997, the first time the official forecast has fallen below 2% since the 1940s.

WHY PEPSI IS ORDERING OUT FOR PIZZA

Decades ago, both Coca-Cola and PepsiCo assumed that because both were terrific at selling soda, they should be able to transfer that ability to other consumer products. This is one of corporate America's great fallacies.

Coke discovered this first, and ended up dumping a film studio, plastic bags, wine, just about anything that didn't contain sugar and fizz. Result: an unprecedented run of sales and earnings growth that has created billions in shareholder wealth.

Pepsi held on, and is now paying the price. Last week the company announced it was spinning off into an independent company its fast-food restaurant group, which includes about 29,000 Pizza Hut, Taco Bell and KFC outlets, with sales of more than $20 billion. The restaurant group was eating capital the way a teenager can go through an extra-large taco, capital that could have been fueling growth at Pepsi. Says CEO Roger A. Enrico: "Our goal in taking these steps is to dramatically sharpen PepsiCo's focus." He needs to, given Pepsi's loss of global share. Pepsi will keep Frito-Lay, the undisputed king of snacks. This leaves Enrico free to return to the cola wars. Things are about to get interesting.

GREEN FLU STRIKES COOKIE SALES

The Girl Scouts of Mount Laurel, New Jersey, are working on a new badge: "hard bargaining." Smack in the middle of the cookie-selling season, 27 area troops demanded a bigger commission from the South Jersey Pines council, which oversees Mount Laurel and six other area troops. When HQ rejected their request, the troops retaliated with a slowdown, vowing to peddle only the 12-box minimum. "This is the first I've heard of anything like this," says Marianne Ilaw, spokeswoman for the Girl Scouts of America, which has been selling cookies annually for 69 years.

The Mount Laurel scouts contend that of the final cookie cut, they're getting only crumbs. Last year the 400 scouts sold $111,000 worth of cookies (up to 100 boxes each). The troops' take: $15,000, or 40[cents] a box. But the baker got $30,000, and the Pines council got $66,000, which goes toward services and programs. This year the troops asked for 60[cents], with a guarantee to sell an average 110 boxes a scout. The council countered with 45[cents], throwing in incentives like patches, or 50[cents] without the extras. No deal. Looks like the scouts' next badge might be for restructuring.