Mar 05, 2015 Newsdesk Latest News, Top of the deck, World  
The operating unit of casino company Caesars Entertainment Corp has revealed plans to exit voluntary bankruptcy little more than a month and a half after signing up for it. But the process of exiting so-called Chapter 11 bankruptcy – a status which had been sought to protect the operating entity from hostile creditors and to give it time to reorganise its finances – could take as much as a year, reported Reuters.
The exit plan involves the bankrupt unit – Caesars Entertainment Operating Co Inc (CEOC) – being split in two.
One part would run 38 Caesars casinos across the United States, while the other portion would be a property company controlled by a real estate investment trust (i.e., an asset class commonly known to investors as a REIT). In the United States, such entities are subject to favourable tax breaks, which Caesars says will create value for the existing investors.
Caesars’ first-lien note holders would own the operating company when it exits bankruptcy, in exchange for those note holders’ US$6.3 billion of debt. Those senior note holders would also own about 70 percent of the property company; with junior creditors getting the rest in exchange for their US$5.2 billion in debt, reported Reuters.
“The debtors believe this structure materially improves stakeholder recoveries versus a more traditional ‘standalone’ restructuring,” the company said in a filing on Monday with a U.S. Bankruptcy Court.
Reuters reported that the exit plan must be approved by U.S. Bankruptcy Judge Benjamin Goldgar in Chicago and by creditors, a process that could take a year or more.
The plan was filed the same day parent company Caesars Entertainment Corp reported its fourth-quarter net loss narrowed to US$1 billion from US$1.76 billion a year earlier.
On Tuesday, a trustee for US$750-million of junior notes sued the parent company in Manhattan federal court in New York City, seeking to enforce the parent’s guarantee of the notes and seeking full repayment plus damages.
The original request from CEOC for reorganisation under Chapter 11 of the U.S. Bankruptcy Code was lodged in the Northern District of Illinois in Chicago on January 15.
The bankruptcy put on hold lawsuits launched by other creditors who alleged the parent company looted the operating unit of its best casinos and properties and left it without enough assets to pay its debts.
Aug 02, 2023
Jul 17, 2023
Apr 29, 2024
Apr 29, 2024
Apr 29, 2024
With effect from May 6, a number of visa-policy easing measures take effect for mainlanders wanting to visit Macau. They include the possibility of multiple entries between Macau and Hengqin for...(Click here for more)
"Pagcor is able to sustain its growth trajectory in the first quarter of 2024 and this should help position us into achieving another record-breaking year"
Alejandro Tengco
Pagcor chairman and chief executive