GGRAsia – Caesars pledges equal treatment for senior creditors

Caesars pledges equal treatment for senior creditors

Jan 02, 2015 Newsdesk Latest News, Top of the deck, World

U.S.-based casino company Caesars Entertainment Corp (CEC) has amended its restructuring agreement with senior holders of its bank debt and its bonds.

The plan involves a voluntary bankruptcy of one company unit and other financial measures that combined should eliminate nearly US$10 billion from the group’s current US$22.8 billion debt load.

Under the amendment – filed with Nasdaq on Wednesday – CEC and Caesars Entertainment Operating Co Inc (CEOC) have agreed to spell out that all first-lien bank debt holders and all first-lien bondholders are to be treated equally.

The same principle will apply to any claimants upon such senior bank debt or bonds.

The filing stated: “CEC, CEOC and their respective affiliates will not offer any additional consideration to any holders of first lien notes or any holders of indebtedness incurred by CEOC…without making any such additional consideration available to consenting creditors that are holders of first lien bond claims or holders of claims with respect to first lien bank debt…”

On December 15, CEC had said in a filing it had “elected not to pay” US$225.3 million in interest to junior creditors while it continued debt-restructuring negotiations with its more senior lenders.

On December 29, CEC stated in a filing that more than 39 percent of first-lien claimants against Caesars Entertainment Corp’s senior notes had agreed on a plan to restructure the casino group’s debts. But Caesars acknowledged in that document that it needed 60 percent support from its first-lien debt holders by January 9 for the current restructuring deal to become effective.