Caesars directors must 'pony up' details of wealth: judge

Wed Sep 14, 2016 4:22pm EDT
Email This Article |
Share This Article
  • Facebook
  • LinkedIn
  • Twitter
| Print This Article | Single Page
[-] Text [+]

By Tracy Rucinski

CHICAGO (Reuters) - Billionaire investors Marc Rowan and David Bonderman are among Caesars Entertainment Corp (CZR.O: Quote) directors who must disclose details of their wealth to creditors of the casino holding company's bankrupt subsidiary, a U.S. judge said on Wednesday.

Junior creditors of Caesars Entertainment Operating Co Inc (CEOC) convinced the court on Wednesday to force six of the parent's directors to prove they can contribute to CEOC's reorganization plan in exchange for releases from allegations of fraud.

"These folks are going to have to pony up the paper," U.S. Bankruptcy Judge Benjamin Goldgar said at a hearing in Chicago on Wednesday.

CEOC filed an $18 billion bankruptcy in January 2015.

Junior creditors accuse directors of Caesars and its private equity sponsors Apollo Global Management LLC (APO.N: Quote) and TPG Capital [TPG.UL] of orchestrating a plan to strip CEOC of "crown jewels" such as the Linq Hotel & Casino complex in Las Vegas prior to its bankruptcy.

While Caesars, Apollo and TPG have denied the allegations, a court-appointed independent examiner found in March that the three could be on the hook for up to $5 billion.

Caesars has pledged $4 billion to a CEOC reorganization plan that junior creditors refuse to support, arguing in part that individual directors should contribute if they want releases from claims.

In a motion filed on Aug. 31, the creditors demanded financial information from Caesars' directors Rowan and David Sambur of Apollo and Bonderman and Kelvin Davis of TPG, as well as former Caesars' executives Eric Hession and Gary Loveman, who remains on the board.   Continued...

David Bonderman  during the 2014 Milken Institute Global Conference in Beverly Hills, California April 29, 2014.  REUTERS/Kevork Djansezian