Speaker 1: This is taking stock with pim Box and Kathleen Hayes
Speaker 1: on Bloomberg Radio. Caesar's Entertainment It's number three eight on
Speaker 1: the Fortune five hundred this year. Once the fast growing
Speaker 1: star of the gaming industry, Caesar's is now a mess.
Speaker 1: It is the site of a battle between some very
Speaker 1: big and powerful buyout firms and some very big and
Speaker 1: powerful hedgephones, or the outcome of a January fifteen bankruptcy filing.
Speaker 1: In fact, today Caesar's Entertainment Corps telling the most in
Speaker 1: more than a year after judge ruled that it must
Speaker 1: face bond holder lawsuits that could force it into bankruptcy.
Speaker 1: Alongside its main operating a unit joining us now is
Speaker 1: Stephen Church, bankruptcy reporter for Bloomberg News in Welmington, Delaware. Steve, welcome, Thanks,
Speaker 1: good to be here. So first step, why, why why
Speaker 1: did Caesar's Entertainment stumble so badly? And why has the
Speaker 1: bankruptcy become such a battle. Well, they had a buy
Speaker 1: out several years ago, I think it was two thousand
Speaker 1: eight or so that added a lot of debt. They
Speaker 1: took the company private and the company simply hasn't been
Speaker 1: able to keep up with those debt payments. Over the years,
Speaker 1: they've made several attempts to restructure, and finally in two
Speaker 1: thousand fifteen last year, Caesar's put its main operating unit
Speaker 1: into bankruptcy. Now you have two units. Now you have
Speaker 1: two Caesars. Really, you have a Caesar's it's publicly traded,
Speaker 1: that is still not in bankruptcy, and then you have
Speaker 1: its main operating unit, which is struggling with creditors. That's
Speaker 1: created a mess that they're trying to sort out in
Speaker 1: two courts, in bankruptcy court in Chicago and in courts
Speaker 1: in Delaware and New York. Give us in a nutshell,
Speaker 1: what's one side arguing against the other. Bottom line is
Speaker 1: the some uh Second Lean bond holders believe that the
Speaker 1: non bankrupt company, Caesar's Entertainment Corps, should pay the debts
Speaker 1: of the bankrupt company, and the Caesar's Entertainment based in
Speaker 1: Las Vegas, has said no, we we legally and legitimately
Speaker 1: shed those debts and we no longer are responsible for
Speaker 1: paying the it's more than five billion dollars in Second
Speaker 1: Lean debt. The court in New York is ready tomorrow
Speaker 1: to hear final arguments about who's right on that issue. Okay,
Speaker 1: and uh, what what is the latest ruling in terms
Speaker 1: of its import and what it tells us next? Absolutely,
Speaker 1: the latest ruling came out of Chicago bankruptcy court, where
Speaker 1: a judge said, go ahead, bondholders, you can sue in
Speaker 1: New York and move forward in New York and try
Speaker 1: to win. The reason that has upset the shareholders and
Speaker 1: Caesar's is they think they might lose Caesar's Caesar's and
Speaker 1: might lose this case in New York, and which case
Speaker 1: the parent company could join the operating unit in bankruptcy,
Speaker 1: and in shareholders in that case are much more likely
Speaker 1: to be wiped out. How much money is it stake?
Speaker 1: And you know, could all this uh you know actually
Speaker 1: force the company to go completely under? I mean it
Speaker 1: could because Caesar's Caesar's um overall value is only a
Speaker 1: couple of billion dollars. The non bankrupt company to Las Vegas,
Speaker 1: Company's only worth a couple of billion dollars. When you
Speaker 1: look at what it's market capts, it's facing liabilities that
Speaker 1: are at least five billion, possibly as much as eleven
Speaker 1: billion dollars depending on how the courts in Delaware and
Speaker 1: New York rule, all that debt could come crashing down
Speaker 1: onto the parent company, and there's just no way. Everyone admits,
Speaker 1: Caesar's admits, and all of the bondlers admit, there's no
Speaker 1: way that that that Caesar's could pay that debt and
Speaker 1: remain solvent. Stephen Church, thank you so much for just
Speaker 1: a masterful wrap up of what's going on with Caesar's Entertainment.
Speaker 1: He's bankruptcy reporter for Bloomberg News in Wilmington, Delaware,