New Jersey Casino Regulator Gives the Nod to Caesars’ Reorganization Plan

The New Jersey Casino Control Commission approved on Tuesday the proposed plan for the reorganization of major casino operator Caesars Entertainment Operating Co (CEOC), The Press of Atlantic City reported. The Las Vegas-headquartered company currently operates the Bally’s, Caesars Atlantic City, and Harrah’s resorts in Atlantic City.

Under its restructuring plan, CEOC will be able to lease the operations of the Atlantic City hotel and casino venues as well as of the rest of its properties across the US to a newly formed operating unit. The New Jersey Casino Control Commission was among the gambling regulators that had to give their approval to the plan in order for the casino operator to be able to emerge from Chapter 11 bankruptcy organization.

The state casino regulatory body will also grant licenses that will authorize the newly formed business entity to operate the two Atlantic City-based casinos. Commenting on the announcement, Casino Control Commission Chairman and CEO Matthew B. Levinson said that he believes Caesars will emerge from bankruptcy successfully and will be able to grow its operations in Atlantic City.

Caesars’ main operating unit – Caesars Entertainment Operating Company – filed for Chapter 11 bankruptcy protection in mid-January 2015 in an attempt to offload part of its $18-billion debt. Bankruptcy proceedings took precisely two years before the US Bankruptcy Court for the Northern District of Illinois approved the company’s previously proposed reorganization plan in January 2017.

Under the plan, CEOC will be able to exit bankruptcy by splitting its US real property assets from its casino operations. Caesars Entertainment will be the operator of the gambling business, while the remaining assets will be owned by a specially created real estate investment trust.

Despite the court approval, Caesars now needs the nod from several regulators in the states where it operates in order to be able to proceed with the restructuring. It is believed that the company and its main operating unit will emerge from bankruptcy by the end of the year.

In May, Caesars CEO Mark Frissora said in an interview with Bloomberg TV that the company would work to further extend its footprint on the Las Vegas Strip and to expand to other jurisdictions as well. Merger and acquisition opportunities would also be considered by the operator once it completes its restructuring process, the executive pointed out.

Brazil, South Korea, Japan, and Canada were revealed as the jurisdictions that Caesars has been interested in and will try to expand into in the years to come.

According to Mr. Frissora, the operator had enjoyable two years in terms of sales and profitability, despite the ongoing bankruptcy proceedings.

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