NEW YORK (TheStreet) -- Shares of Caesars Entertainment (CZR) - Get Free Report were rising in pre-market trading on Tuesday as a Chicago judge granted the company a two-week extension on a shield from bondholders' lawsuits worth approximately $11 billion.
Noteholders are suing the Las Vegas-based casino and hospitality company for allegedly failing to honor its guaranty of bonds issued by its bankrupt parent company, Caesars Entertainment Operating Co. (CEOC). The lawsuits would also boost their recoveries above the 34% offered by Caesars, according to Bloomberg.
Last week, a Chicago bankruptcy judge ruled that Caesars must face the lawsuits, after the company argued that allowing them to proceed would threaten their negotiations process.
A group of second-lien bondholders is the only large group of Caesars creditors that has failed to sign onto an agreement reorganizing the bankrupt casino operator.
Judge Matthew Kennelly of the U.S. District Court for the Northern District of Illinois decided Monday that the lawsuits will now be stayed until Sept. 16, Reuters reports.
Had the shield not been extended, Caesars would have had to face the lawsuits beginning Aug. 29.
Caesars last week asked its majority shareholders, Apollo Global Management (APO) and TPG Capital, for $990 million to help lift the company out of bankruptcy. The firms denied to provide funding.
CEOC filed for bankruptcy in January 2015 with $18 billion in debt.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
TheStreet Ratings team rates CAESARS ENTERTAINMENT CORP as a Sell with a ratings score of D. This is driven by a few notable weaknesses, which it believes should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks the team covers. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, generally disappointing historical performance in the stock itself and feeble growth in its earnings per share.
You can view the full analysis from the report here: