100xOdds
100xOdds
Joined: Feb 5, 2012
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September 29th, 2016 at 7:38:17 AM permalink
http://www.cdcgamingreports.com/caesars-reaches-restructuring-deal-with-its-major-creditors

Second-lien bondholders, owed about $5.5 billion, appeared to be the biggest winners in the agreement. Those investors, led by David Tepper’s Appaloosa Management, will see a recovery rate of about 66 cents on the dollar, or about 27 cents more than under a previous plan, according to the statement.

Recovery rates for first-lien bank lenders and subsidiary guaranteed noteholders decrease by about 1 cent under the new plan, while rates for first-lien noteholders remain the same. Creditors will get about 70 percent of the fully diluted equity in the new Caesars’ structure, according to the statement.

Until last week, the second-lien bondholders had maintained a holdout. A proposal unveiled Sept. 21 offered to increase their payout by about $1.6 billion. Approximately $1.2 billion of that would come from the non-bankrupt Caesars parent in the form of cash and stock.

Caesars had originally offered about $4 billion toward the reorganization, but the second-lien bondholders held out for more, saying the company had improperly shifted valuable assets out of the operating unit before putting it into bankruptcy.


I guess Caesar's strategy of shifting around the good casinos and leaving the bad ones to bond holders didn't work.
they caved and ponied up a lot more $$$ to them.

I'm guessing court rulings against them poked some legal holes in that strategy.
Craps is paradise (Pair of dice). Lets hear it for the SpeedCount Mathletes :)
rdw4potus
rdw4potus
Joined: Mar 11, 2010
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September 29th, 2016 at 7:45:48 AM permalink
Quote: 100xOdds

http://www.cdcgamingreports.com/caesars-reaches-restructuring-deal-with-its-major-creditors

Second-lien bondholders, owed about $5.5 billion, appeared to be the biggest winners in the agreement. Those investors, led by David Tepper’s Appaloosa Management, will see a recovery rate of about 66 cents on the dollar, or about 27 cents more than under a previous plan, according to the statement.

Recovery rates for first-lien bank lenders and subsidiary guaranteed noteholders decrease by about 1 cent under the new plan, while rates for first-lien noteholders remain the same. Creditors will get about 70 percent of the fully diluted equity in the new Caesars’ structure, according to the statement.

Until last week, the second-lien bondholders had maintained a holdout. A proposal unveiled Sept. 21 offered to increase their payout by about $1.6 billion. Approximately $1.2 billion of that would come from the non-bankrupt Caesars parent in the form of cash and stock.

Caesars had originally offered about $4 billion toward the reorganization, but the second-lien bondholders held out for more, saying the company had improperly shifted valuable assets out of the operating unit before putting it into bankruptcy.


I guess Caesar's strategy of shifting around the good casinos and leaving the bad ones to bond holders didn't work.
they caved and ponied up a lot more $$$ to them.

I'm guessing court rulings against them poked some legal holes in that strategy.



Are you sure the shifting strategy failed? It's definitely true that Caesars was forced to pay more than they wanted to the second-lien bondholders. But to determine the value of the strategy, you'd also need to know if that payment was more or less than they'd have paid if the shift wasn't implemented. I'm guessing that it was less.
"So as the clock ticked and the day passed, opportunity met preparation, and luck happened." - Maurice Clarett
100xOdds
100xOdds
Joined: Feb 5, 2012
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September 29th, 2016 at 7:59:30 AM permalink
Quote: rdw4potus

Are you sure the shifting strategy failed? It's definitely true that Caesars was forced to pay more than they wanted to the second-lien bondholders. But to determine the value of the strategy, you'd also need to know if that payment was more or less than they'd have paid if the shift wasn't implemented. I'm guessing that it was less.


ahh.. true.
overall, caesars will wipe out ~30% of it's $18B debt.
but the Apollo Group gives up a big stake in Caesars. (but which caesars? bankrupt bad casinos sub unit, or caesars parent?)

now waiting for a Mathlete for the calcs to the scenario of the Apollo Group not shifting around the good casinos.

also, this reorg is just for the bad casinos sub unit?
Apollo Group still keeps majority control over the good casinos sub unit?

Only CEOC sub unit filed for bankruptcy:
Last edited by: 100xOdds on Sep 29, 2016
Craps is paradise (Pair of dice). Lets hear it for the SpeedCount Mathletes :)

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