By Tracy Rucinski
(Reuters) - Caesars Entertainment Corp (O:CZR) is "optimistic" of finally reaching a $5 billion agreement with creditors to push its main operating unit out of a long and costly bankruptcy, the Las Vegas-based casino group said in a statement on Monday.
The company's main operating unit, Caesars Entertainment Operating Co Inc, filed for Chapter 11 protection in January 2015 with $18 billion of debt, sparking a bitter legal battle with creditors who alleged asset-stripping by the parent in the run up to the bankruptcy.
Caesars and its private equity owners Apollo Global Management (N:APO) and TPG Capital Management (TPG.UL) have said the transactions, which shifted choice hotels and casinos into other subsidiaries, were fair.
In attempt for peace, Caesars, Apollo and TPG offered on Wednesday to put more money into a settlement offer with creditors in exchange for legal releases from claims of fraud.
While Caesars gave creditors a Sept. 23 deadline for accepting the offer, talks continued over the weekend.
"Caesars Entertainment and CEOC are working vigorously and collaboratively with the parties on the details and documentation," the casino group said in a statement on Monday, adding it was "optimistic" that an agreement would be reached.
Caesars shares were up 1.4 percent at $9.67 in early Nasdaq trading. The stock is up 45 percent since Caesars sweetened the settlement offer on Wednesday.
The latest offer from Caesars and private equity firms would add $1.6 billion for hold-out junior creditors in exchange for them dropping legal claims. A court-appointed independent examiner found in March that the three groups could be on the hook for around $5 billion.
Caesars had previously said it would contribute $4 billion to the CEOC reorganization, which envisions splitting the subsidiary into an operating unit and a separate real estate investment trust.