Caesars avoids bankruptcy fear - for now

Caesars avoids bankruptcy fear - for now

Monday, February 29, 2016 Totally Gaming
The casino operator said bankruptcy would prevent it from contributing to CEOC’s restructure

Shares in Caesars Entertainment Corp soared on Friday after a judge decided to stay a bondholder lawsuit against the casino operator.

Judge Benjamin Goldgar made the decision following Caesars’ claim that it could be plunged into bankruptcy alongside its Caesars Entertainment Operating Company (CEOC) unit, which filed a Chapter 11 last year.

The judge said the stay on the litigation would be lifted either on May 9 or 60 days after examiner Richard Davis publishes his report into corporate deals that the bondholders allege stripped the operating unit of its best assets.

In his ruling, the judge cited Caesars’ arguments that a loss at trial—where bondholders, led by fund manager Appaloosa Management, are seeking to hold Caesars to guarantees of some $7.1bn (€6.5bn) in debt owed by CEOC—would likely force it to join CEOC in bankruptcy, jeopardising its ability to make a significant financial contribution to CEOC’s restructuring.

“An injunction is likely to enhance the prospects for a successful reorganisation,” the judge wrote. “A $7.1 billion judgment would deprive [Caesars] of the assets needed to satisfy the estate’s claims and rule out any [Caesars] contribution to the plan.”

The bondholders opposed Caesars’ request for an injunction, arguing that answering the question of whether Caesars must guarantee CEOC’s debt would help resolve the disputes that have kept CEOC from achieving a consensual restructuring plan.

Shares of Caesars were up 8.9 per cent in late day trading on Nasdaq.

Hard Rock Hokkaido

Hard Rock details plans for integrated Japanese resort

American football

Caesars strikes New York and NFL deals


AGS agrees $49m acquisition of Integrity Gaming

Scientific Games

Scientific Games settles Shuffle Tech patent case

Gaming Products & Services Directory

The essential directory for the gaming industry