A cash-strapped division of casino giant Caesar’s Entertainment Corp. has filed for Chapter 11 bankruptcy protection in Chicago as it tries to restructure $1.84 billion in debt. But the bankruptcy filing will not affect Harrah’s land-based casino in New Orleans, which is owned by a separate Caesar’s affiliate and will remain open for business as usual.
The filing will impact several other casinos in Louisiana and Mississippi, however, including Harrah’s Louisiana Downs and Horseshoe Bossier Casino, both of which are in north Louisiana, as well as Horseshoe Tunica, Tunica Roadhouse and Harrah’s Gulf Coast in Mississippi.
Bondholders and the north Louisiana casinos long have feared this bankruptcy was coming. As Business Report detailed last May, officials with Caesar’s parent company appeared before the Louisiana Gaming Commission last year and received permission to transfer the high-performing Harrah’s New Orleans casino out of its overleveraged Caesar’s Entertainment Operating Co. and into a newly created entity, Caesar’s Growth Partners, which contains several of the company’s strongest properties.
At the time, bondholder attorneys said the parent company intentionally was hanging its weaker properties out to dry by taking its best-performing assets out of a troubled company and putting them into a new company without any bad debt.
It is unclear what the bankruptcy will mean for the north Louisiana casinos, but a company statement says all the casinos owned by the bankrupt entity will continue to operate as normal during the restructuring. Read more about the bankruptcy filing from Bloomberg.
