(Bloomberg) — Caesars Entertainment Corp. took a significant step toward a bankruptcy of its biggest unit that would allow the struggling casino operator to quickly shed about half of its debt.

Caesars struck a deal with some of its senior creditors that would put its most-indebted unit into bankruptcy by mid- January, according to a statement today. The Las Vegas-based company must still get more creditors to sign on.

The casino company has been struggling to meet its obligations since being taken private in a $30.7 billion leveraged buyout by Apollo Global Management LLC and TPG Capital in 2008. Caesars has been negotiating with creditors for three months to restructure its debt after losing money every year since 2009.

“We believe the financial restructuring plan we are announcing today is in the best interests” of our stakeholders, Gary Loveman, chairman of the Caesars parent company, said in the statement.

The plan would reorganize Caesars Entertainment Operating Co.’s $18.4 billion in debt by turning it into a real estate investment trust. The new unit, which would be split between a property owner and a management company, would have $8.6 billion in debt, according to the statement.

Much of the plan has already been disclosed in previous statements from the company. Senior creditors would recover most of their investment while junior ones — who haven’t agreed to the plan — would potentially just receive a small sliver of equity.

Sweetened Terms

Today’s agreement sweetened the deal for senior bondholders, a group of whom helped draft the plan. It offers them the option to backstop $300 million of convertible preferred equity securities issued by the new REIT’s property arm, according to the statement. They would get fees for doing so and have until Dec. 24 to sign on.

Caesars has support from holders of $2.4 billion of its first-lien bonds and needs an additional $1.8 billion to meet voting thresholds required to approve a bankruptcy plan. Some stakeholders, such as BlackRock Inc., exited talks as recently as last week, according to three people with knowledge of the move who asked not to be named because the discussions were private.

The company said it won’t put the parent company or two other operating companies into Chapter 11 proceedings. The parent company will give as much as $1.45 billion in cash to the troubled operating unit to support the restructuring plan, according to the statement.

Apollo and TPG’s takeover of Caesars, arranged just as the credit crisis unfolded, was part of a buyout boom fueled by cheap debt that spawned super-sized takeovers. Several of those have struggled to repay their borrowings, including bankrupt Energy Future Holdings Corp.

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