Caesars Entertainment to plead for stay in bankruptcy case
Leon Black’s Caesars Entert🌼ainment suddenly looks lik💧e it has a weaker hand.
Caesars on Wednesday wil💦l ask a Chicago federal judge in the bankruptcy case of its largest unit for a stay in what it believes is a related New York federal civil suit against the parent company.
That way🐼 it can finish its bankruptcy restructuring fꦺirst.
New York District Judge Shira Scheindlin last week indicated she would like to rule on a $750 million lawsuit alleging that Caesars’ parent illegally removed a 🤡loan repayment guarantee it held against the now-bankrupt unit before the present bankruptcy case concludes.
Caesars shares Monday plunged 1🦩6 percent to $7.86.
If the Chicago judge doe🌟s not give Ca༒esars a stay, an adverse New York ruling could ultimately force all of Caesars into bankruptcy, sources said.
“There is a 5🍨0/50 chance the [Chicago] judge gives them a stay,” a source close to the Caesars case said.
The New York judge will likely rule against Caesars, multiple 🅰sour𝓰ces said.
Caesars last year approached half of a group of bondholders and offered to pay them 100 cents on the dollar for their debt — wh🍷en the bonds were trading at less than 50 cents.
The bon🔥dholders, in turn, agreed to eliminate a guarantee against the parent.
The Bank of Oklahoma and related Meehan Combs lawsuits allege that Caesars needed to make the offer to a♕ll debtholders 🀅and not just a slim majority.
Black🍨, af✱ter eliminating the loan guarantees, split Caesars into three units, putting its biggest firm, and many of its worst assets, in bankruptcy.
Apollo and TPG Capital own s🦩hares in🍌 the non-bankrupt units, giving them some recovery on their roughly $3.5 billion combined equity investment.
A Caesars spokesmanಌ said, “As we have repeatedly argued in court, the parent guarantee was validly terminated.”
Meanwhile, New Jersey lawmakers on Monday introdu♏ced a bill allowing voters to choose whether to open three new North Jersey cas🧸inos. Caesars owns two of Atlantic City’s eight remaining casinos and would likely be hurt by new competition.