How Caesars dodged bankruptcy
HOLD-OUT creditors of Caesars Entertainment Corp’s bankrupt operating unit accepted a sweetened $5bn deal on Tuesday that could finally extricate the casino group from a costly bankruptcy.
Following are key events in the $18bn bankruptcy of the Las Vegasbased casino group’s main operating unit, Caesars Entertainment Operating Corp, or CEOC.
August 2014: Caesars and its creditors file lawsuits against each other. Creditors say the parent company was fraudulently transferring choice casinos and hotels out of CEOC.
December 2014: Caesars announces its plan to merge with affiliate Caesars Acquisition in an allstock deal that would provide the financing to support CEOC’s restructuring in exchange for legal releases from creditors.
January 2015: CEOC files for Chapter 11 protection in the US bankruptcy court in Chicago with an agreement with first-lien lenders to split into two companies and cut $10bn of debt.
March 2015: US bankruptcy judge Benjamin Goldgar gives independent examiner Richard Davis wide scope to investigate seven deals challenged by creditors.
October 2015: Caesars tries to woo creditors by offering to contribute an estimated $1.5bn into CEOC’s restructuring.
March 2016: Examiner Davis concludes that Caesars and its private equity backers could be on the hook for up to $5.1bn in potential damages over a series of corporate deals that he said left CEOC unable to pay a mountain of debt.
March 2016: Retired US bankruptcy judge Joseph Farnan is hired as an out-of-court mediator to help reach a settlement.
May 2016: Caesars hires retired US bankruptcy judge Robert Gerber to the new role of chief restructuring officer.
May 2016: Caesars offers $4bn in a new plan with higher recoveries for creditors to help CEOC emerge from Chapter 11.
August 26 2016: Judge Goldgar withdraws a shield on lawsuits against the Caesars parent by hedge fund creditors owed billions of dollars by CEOC.
August 30 2016: CEOC appeals against Goldgar’s ruling, and creditors’ lawsuits are again stayed.
September 9 2016: Farnan abruptly steps down as mediator, blaming Goldgar’s views.
September 21 2016: Caesars offers further $1.6bn, saying this is its “best-and-final offer”.