Casino operator Caesars Entertainment plans to spend $75m gussying up Caesars Palace in Las Vegas, despite its owner being mired in highly contentious bankruptcy proceedings.
On Friday, Caesars announced it would give the 50-year old Caesars Palace a badly needed facelift. The renovation will focus on the property’s hotel rooms, some of which haven’t been upgraded in 15 years. Once complete, the upgrade will add 20 extra rooms to the original 567-room Roman Tower, which will be rebranded as ‘Julius.’
Caesars Palace, which opened in 1966, is the flagship property of Caesars Entertainment Operating Co (CEOC), which filed for Chapter 11 bankruptcy protection in January, citing $18.4b in debts. It’s unclear whether CEOC or its parent company Caesars Entertainment Corp (CEC) sought permission from US Bankruptcy Judge Benjamin Goldgar to allocate the $75m for the facelift.
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Meanwhile, the junior creditors that are fighting CEOC’s restructuring efforts have found a new front on which to wage war against Caesars’ evil empire. On Wednesday, a group of junior creditors filed papers asking Judge Goldgar to reconsider his approval of the law firm of Kirkland & Ellis handling CEOC’s bankruptcy.
The creditors, whose original objection to Kirkland’s participation was overruled by Goldgar earlier this year, claim they have new evidence that shows Kirkland misled Goldgar as to the extent of its pre-bankruptcy dealings with Caesars.
The issue involves the controversial pre-bankruptcy asset transfers that the creditors claim were intended to strip CEOC of its most valuable assets to shield them from creditors during the restructuring. The creditors filed lawsuits protesting these transfers, while CEOC filed its own lawsuit in August 2014 to confirm the transfers’ legality.
A Kirkland attorney told Goldgar that the firm wasn’t involved with CEOC’s lawsuit, and the creditors say this assertion was what convinced Goldgar to allow Kirkland to handle CEOC’s bankruptcy. But the creditors say they now have the minutes of an August 2014 meeting of CEOC’s board of directors that proves Kirkland’s testimony to Goldgar was “at best, incomplete and misleading.”
The filing doesn’t reveal specifically what dirt the creditors have on Kirkland, as Caesars has reportedly declared the information to be confidential. The creditors have asked Goldgar to review Kirkland’s apparent conflict of interest at a Nov. 18 hearing.
Just a thought, but given the volume of paperwork CEOC’s bankruptcy has generated, perhaps Caesars Palace could cut costs upgrading those hotel rooms by using legal briefs as wallpaper?
