A court-appointed examiner’s report, ironically published on the Ides of March, discovered evidence of asset-stripping in Caesars bankruptcy reorganization.
Caesars could face billions of bucks in potential damages in relation to its bankruptcy restructuring, based on the suggestions of the court-ordered examiners’ report, published Tuesday.
The company is searching for chapter 11 bankruptcy for its primary operating product, CEOC, so as to reorganize $18 billion of its debt, it is facing opposition from its junior creditors.
Ex-Watergate prosecutor Richard Davis led a team of attorneys which spent an investigating the casino giant’s corporate dealings year.
Their aim: to determine whether, as alleged, the business fraudulently transferred many of CEOC’s prime assets to Caesars Entertainment as well as other subsidiaries for the benefit of its controlling equity that is private, while placing them out of the reach of this junior creditors.
This form of asset-stripping left CEOC with nothing but assets that are distressed an inability to cover its debts, argues a team of creditors led by the Appaloosa Management hedge fund, which will be suing Caesars.
CEOC Possibly Insolvent as Early as 2008
The investigation team poured over 80 million pages of documents to produce its 80-page report. But eventually it all boiled down to one word.
‘ The answer that is simple this question is ‘yes Continue reading