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Jan. 18, 2017

U.S. Bankruptcy Court Confirms Chapter 11 Plan of Reorganization for Caesars Entertainment

On January 17, 2017, the United States Bankruptcy Court for the Northern District of Illinois confirmed the Chapter 11 plan of reorganization for Caesars Entertainment Operating Company, Inc. and its affiliated Debtors, following more than two years of protracted bankruptcy proceedings, litigation and negotiations.

Kramer Levin played a pivotal role in the negotiations that formed the basis for Caesars’ 2015 bankruptcy filing, and has continued to represent holders of more than $3 billion of first lien notes issued by Caesars (the largest and key creditor constituency) throughout the evolution of these uniquely complex Chapter 11 cases. On behalf of its clients, Kramer Levin has been actively involved in all material aspects of the Caesars cases, including litigation surrounding the rights and claims of first lien bondholders, mediation and plan negotiations that ultimately resulted in restructuring support agreements being signed by every major creditor constituency and a fully consensual plan.

Pursuant to the confirmed plan of reorganization, Caesars’ gaming and hotel businesses will be separated into two separate companies: a real estate investment trust (REIT) to hold Caesars’ valuable real estate assets and an operating company to manage those gaming and hotel operations. Kramer Levin’s clients are to receive consideration in the form of cash, debt and equity securities that Caesars has valued at approximately 109% of their prepetition claim amounts. Post-confirmation, Kramer Levin will continue to work on the corporate, regulatory and organizational issues necessary to implement the restructuring contemplated by the plan, particularly the formation of the REIT structure.

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