A federal judge gave the thumbs-up Tuesday to a plan to reorganize a subsidiary of casino giant Caesars Entertainment Corp., clearing the way for the operating unit to exit bankruptcy two years after filing for Chapter 11 protection with $18 billion in debt.
The approval from U.S. District Judge Benjamin Goldgar in Chicago is a "major milestone," said Mark Frissora, CEO of the Las Vegas-based parent company.
The subsidiary, Caesars Entertainment Operating Co. Inc., would emerge later this year with the separation of its U.S. property assets from its gambling operations. Reorganization would also enable it to lighten its massive debt burden by $10 billion.
"The new Caesars will be a stronger company," Frissora added in a statement issued shortly after the ruling.
Fully implementing the reorganization still depends on securing approval from gambling regulators, as well as on the completion of the parent's company's merger with Caesars Acquisition.
"While there is still much work ahead to complete this process, we are excited about the future of the Caesars enterprise," Frissora said.
Caesars Entertainment Corp. operates 50 casinos in five countries and 13 states, including Nevada, Illinois, Indiana, Pennsylvania and New Jersey. It employs more than 60,000 people. Its resorts operate primarily under the brands Caesars, Harrah's and Horseshoe.
Caesars' resorts and casinos stayed open during the complex and sometimes-contentious bankruptcy proceedings.
Up to 200 lawyers for debtors and creditors attended pivotal hearings in Chicago. At one early stage in the process, Judge Goldgar said he was already buried in court-filing printouts piled around his chambers.
"I have never seen so much paper in my life," he said.