NEW YORK (TheStreet) --Shares of Caesars Entertainment Corp. (CZR) are lower by 10.63% to $13.28 in mid-morning trading on Friday, as lenders exited talks over the casino operator's restructuring of its largest unit, Caesars Entertainment Operating Co., Bloomberg Businessweek reports.
The lenders also released details of Caesars plan to place the unit into bankruptcy and then convert it into a real estate investment trust.
In a statement dated December 11, the creditor group, which is being represented by the financial advisor Rothschild Inc. and the law firm Stroock & Stroock & Lavan LLP, said talks ended on December 10 when a non-disclosure agreement facilitating the negotiations expired, Businessweek added.
Now that the debt holders' negotiations have ended, Caesars must decide if it wants to continue with its plans to file the unit for bankruptcy in January without their support, Businessweek noted.
Having disclosed what was material non-public information, lenders would be allowed to trade Caesars' debt again, according to Businessweek.
The documents the lenders released said the Caesars' plan to turn the unit into an REIT with a landlord unit would carry leverage of almost 10 times debt to earnings, and a management unit carrying leverage of 5.5 times. Together the units would have $8.6 billion in debt, Businessweek said.
Separately, TheStreet Ratings team rates CAESARS ENTERTAINMENT CORP as a Sell with a ratings score of D. TheStreet Ratings Team has this to say about their recommendation: