\nCaesars Entertainment Corp. (CZR) won more support for a plan to put its biggest unit into bankruptcy as soon as next week after a bondholder group that\u2019s already on board with the restructuring bought $500 million of debt from BlackRock Inc. (BLK), according to two people with knowledge of the matter.<\/p>\n
\tCaesars, owned by Apollo Global Management LLC and TPG Capital, has been negotiating with creditors for four months on a plan to reorganize Caesars Entertainment Operating Co., the subsidiary that owns most of its casinos. Its proposal would restructure $18.4 billion of debt by putting the unit into bankruptcy as soon as Jan. 15 and turning it into a real estate investment trust.<\/p>\n
\tThe Las Vegas-based company needed 60 percent of its first-lien bondholders to sign onto the plan by Jan. 12 under the terms of a deal struck with some creditors last month. Caesars said in a regulatory filing today before the trade that it already had 55 percent. The $500 million BlackRock sold represents another 8 percent, bringing the total to at least 63 percent.<\/p>\n
\tUnder the U.S. bankruptcy code, the casino operator needs two-thirds of the bondholders to commit to its strategy before it can implement it in court.<\/p>\n
\tHedge fund Elliott Management Corp. led the purchase and corralled orders from others among the 18 senior bondholders who\u2019d signed Caesars\u2019s bankruptcy plan, said the people, who asked not to be identified because the transaction was private.<\/p>\n
\tCompeting Bid<\/p>\n
\tThe group outbid a rival faction represented by law firm Debevoise & Plimpton LLP that\u2019s seeking more money from Caesars in a restructuring, said one of those people and another person with knowledge of the matter. Caesars has proposed giving first-lien bondholders 93.8 cents on the dollar.<\/p>\n
\tCitigroup Inc. managed today\u2019s sale of the notes.<\/p>\n
\tFarrell Denby, a spokesman for BlackRock, declined to comment, as did Michael O\u2019Looney, a spokesman for Elliott, and Robert Julavits of Citigroup.<\/p>\n
\tMy Chi To, an attorney at Debevoise representing the rival group, and Gary Thompson, a spokesman at Las Vegas-based Caesars, also declined to comment.<\/p>\n
\tLast month, BlackRock dropped out of the group of first-lien holders who purchased the bonds today. It exited restructuring talks along with Caesars\u2019s highest-ranked lenders, who still haven\u2019t reached an agreement on how to restructure the casino operator\u2019s largest subsidiary.<\/p>\n
\tCaesars would have an easier time pushing through its reorganization proposal with the support of those lenders, too.<\/p>\n
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