- This Dec. 27, 2013, photo shows the exterior of Caesars Atlantic City in Atlantic City N.J.
- Associated Press
After a heated venue fight that concluded with Caesars Entertainment Corp.’s bankruptcy remaining in Chicago, not in Delaware, the company returns to the Windy City Monday for its second courtroom appearance there.
Caesars put its largest unit into bankruptcy protection in Chicago Jan. 15, days after a group of creditors filed an involuntary Chapter 11 against the company in Delaware.
A Delaware judge ultimately agreed to let Caesars proceed with its restructuring of $18.4 billion of debt in Chicago, but he had some harsh words for its private-equity owners about a series of financial maneuvers designed to salvage their investment in the casino giant.
Caesars, its owners, and their “suspect” dealings will be “under a magnifying glass” in Chicago, Judge Kevin Gross of the U.S. Bankruptcy Court in Wilmington, Del., said at a recent hearing, calling into question moves the company and its owners Apollo Global Management LLC and TPG made before the bankruptcy filing.
The Chapter 11 filing follows months of fierce negotiations with creditors and years of declining performance at Caesars, once the world’s largest gambling company, after a 2008 leveraged buyout that crippled its balance sheet right as the financial crisis hit.
Among the 18 properties included in the bankruptcy filings are most of the Caesars Palace Las Vegas, two casinos in Atlantic City, N.J., and a dozen Harrah’s or Horseshoe casinos in smaller U.S. markets such as Tunica, Miss., and Reno, Nev.
Tuesday in Manhattan, currency-trading fund International Foreign Exchange Concepts Holdings Inc. heads to court to seek confirmation of its bankruptcy liquidation plan.
Under the plan, different units of FX Concepts will pay varying amounts to their unsecured creditors, ranging from 10% to full repayment.
AMF-FXC Finance LLC, FX Concepts’ lender and largest creditor, will receive the proceeds from the sale of the company’s assets, placing its recovery on $34 million in debt somewhere between 9% and 17%, court papers show. AMF will also receive the right to future distributions that, if they materialize, could raise its recovery to as high as 46%.
A judge already approved the sale of FX Concepts’ assets—including computer models, historical data and the use of the company’s trademark—to Ruby Commodities Inc. for $7.48 million. A judge also signed off on a settlement between FX Concepts and its founder, John R. Taylor, in which he agreed to pay the company and its lender a total of $18.5 million, some funded by the sale of his multimillion-dollar Manhattan apartment.
The liquidating currency hedge fund, founded by Mr. Taylor in 1981, filed for bankruptcy protection in 2013 after it announced it was returning investors’ money.
Later in the week, women’s retailer Wet Seal Inc. is scheduled to head to court to secure final approval for a contested bankruptcy financing package. At a Thursday hearing in Wilmington, Del., the company will ask a judge to approve a $20 million loan from B. Riley & Co. that, if Wet Seal’s proposed reorganization strategy plays out, will convert into 80% of the equity in a slimmed down company.
The financing agreement includes $7.5 million in new letter-of-credit commitments.
When Wet Seal kicked off its bankruptcy a few weeks ago, a competing financing offer emerged from Versa Capital Management LLC. A judge allowed Wet Seal to go with the B. Riley deal on an interim basis even though Versa offered financing on better terms.
Unlike other retailers that have recently sought bankruptcy protection to liquidate stores, Wet Seal is trying to survive its Chapter 11. The turnaround strategy calls for Wet Seal to reorganize around its e-commerce business and stronger-performing stores. In January, the company shut down 338 stores.
-Tom Corrigan, Peg Brickley and Stephanie Gleason contributed to this article.
Write to Sara Randazzo at sara.randazzo@wsj.com. Follow her on Twitter at @sara_randazzo
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