Embattled casino operator Caesars Entertainment is facing fresh pressure from an unexpected source as senior creditors voice objections to the company’s restructuring plan.
On Wednesday, Reuters reported that senior creditors that had been supporting Caesars’ plan to restructure its bankrupt main unit Caesars Entertainment Operating Co (CEOC) were now threatening to leave the company at the altar and file their own restructuring plan.
Caesars sought bankruptcy protection for CEOC last January while proposing a restructuring that would erase around $10b of CEOC’s $18.4b debt. Senior creditors supported this plan, largely because most of that $10b haircut would be shorn from the heads of junior creditors, who have launched numerous lawsuits to force Caesars to offer them better terms.
But Caesars’ efforts to mollify junior creditors don’t appear to be sitting well with senior creditors, who filed papers on Tuesday expressing their concern over the “very substantial decline in the value of the debt and equity securities proposed to be provided” to them.