Caesars Entertainment Operating Co. Needs $3.8 billion in Cash to Leave Bankruptcy

by San Antonio Attorney

The main unit of Caesars Entertainment Corporation has taken steps to raise a total of $3.8 billion in cash so that it can leave bankruptcy, as stated on court papers filed on Wednesday.

After almost two years of legal battle, the subsidiary was able to get support from almost all of its creditors for a comprehensive plan to exit from bankruptcy in 2017.

The reorganization plan of Caesars Entertainment Operating Co Inc. involves dividing Caesars’ core bankrupt entity into a real estate investment trust and casino operator, which creditors will have control of.

If the U.S. Bankruptcy Court approves the plan on January, the company should have a minimum of $1.8 billion in fresh funding for the real estate investment trust, plus $1.2 billion for the casino.

CEOC filed for bankruptcy in January 2015 owing $18 billion to creditors.

The parent company of Caesars has guaranteed around $5 billion to the reorganization plan as part of an agreement that will stop creditors from making claims worth billions of dollars.

In order to raise fund for the plan, creditors Caesars will get shares in a new entity it will form by integrating with Caesars Acquisition Co (CAC), which already decided to sell its Internet games unit for the price of $4.4 billion.

That cash could be useful to the new casino operator, according to Caesars.

Based on CEOC’s court filing, the overall fresh funding is a stipulation to finance creditor payout under its restructuring plan, over and above other unstipulated necessities.

The casino entity sought for court’s permission to hire Millstein & Co, which served has been its bankruptcy adviser, to administer the financing process.

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