The judge in the bankruptcy case of Caesars Entertainment’s largest operating unit has delayed the trial that will determine the future of the operator’s reorganization plan until October 5. U.S. Bankruptcy Judge Benjamin Goldgar granted the delay after an attorney for junior bondholders requested additional time for discovery.
Caesars Entertainment filed a prepackaged Chapter 11 bankruptcy plan for the unit, Caesars Entertainment Operating Company (CEOC), January 15 after working out a restructuring deal with senior noteholders that would reduce the unit’s $18 billion in debt to around $8 billion. It is the largest portion of Caesars Entertainment’s industry-worst $22.8 billion debt load.
That restructuring plan has been under fire from the start by lower-level creditors who claim they are left holding the bag for billions in debt. A total of five lawsuits have been filed, mostly alleging that the transactions Caesars made in advance of the restructuring deal—which moved key assets into a real-estate investment trust—were illegal moves made to preserve equity in the assets for Caesars’ private-equity owners, Apollo Global Management and TPG Capital.
The lower-level creditors are hoping to convince Goldgar that the parent Caesars Entertainment should be forced into bankruptcy under an involuntary Chapter 11 filing the creditors made in New York three days prior to CEOC’s filing in Chicago.
