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Wednesday, January 28, 2015

Caesars' gets its Chicago bankruptcy in win for Apollo, (NASDAQ: CZR)

The bankruptcy of the operating unit of Caesars Entertainment Corp's will proceed in Chicago, a victory for the casino company's private equity backers over its hedge fund creditors who wanted the case in Delaware.The ruling by a U.S. Bankruptcy Judge in Delaware sent shares of parent company Caesars Entertainment, which is controlled by Apollo Global Management and TPG Capital, 6.5 percent higher in midday trade.The ruling resolves Caesars' unusual situation of being in two bankruptcies at once, which began with what is known as an involuntary bankruptcy filing in Wilmington on Jan. 12 by Appaloosa Management and two other hedge funds. Three days later, the operator of 38 casinos filed its own Chapter 11 in Chicago with a plan to cut its debt to $8.6 billion from $18.4 billion.Judge Kevin Gross said a Delaware case would reward the hedge funds and encourage angry creditors to race to a favored court to force companies into bankruptcy. That "would be bad precedent in future bankruptcy cases and for the ability of debtors to openly negotiate with creditors," he said.

Caesars Entertainment Corporation, is a diversified casino-entertainment provider. Shares of CZR traded higher by 3.6% or $0.42/share to $12.09. In the past year, the shares have traded as low as $8.51 and as high as $26.74. On average, 1478760 shares of CZR exchange hands on a given day and today's volume is recorded at 763956.