Caesars warns creditor lawsuits may endanger 'going concern' status
(Reuters) - Casino company Caesars Entertainment Corp (CZR.O: Quote), whose operating unit is in bankruptcy, warned on Monday that the litigation stemming from its restructuring efforts could hamper its ability to continue operating as a going concern.
Creditors have brought numerous lawsuits alleging fraud over transfers of assets out of the operating unit, Caesars Entertainment Operating Company.
As the unit struggled to overhaul its operations prior to filing for bankruptcy in January, it transferred a number of its most valuable properties and casinos to affiliates of the parent company.
Creditors have alleged the moves were illegal efforts by the parent company to put the assets beyond their reach.
The "material uncertainty" over the litigation proceedings "raises substantial doubt about the company's ability to continue as a going concern," the largest U.S. casino company said in a regulatory filing on Monday, its first such warning.
Caesars said that at this time it does not believe that a material loss will result from the outcome of the lawsuits.
Caesars Entertainment said when the operating unit filed for bankruptcy on Jan. 15 that the parent would not need outside financing and would be able to guarantee the lease obligations of the operating unit.
(Reporting by Supriya Kurane in Bengaluru; Editing by Anupama Dwivedi)
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