Underwriter of Caesars stock deal buys 10.34 million shares

Caesars Entertainment Corp. said Tuesday it sold more than 10.34 million shares of its common stock to the underwriter of its public offering in two separate transactions, collecting more than $200 million in proceeds.

In a filing with the U.S. Securities and Exchange Commission, the casino operator said Credit Suisse Securities purchased 10 million shares on Sept. 25 for $19.40 per share. On Sept. 27, Credit Suisse acquired 340,418 additional shares, which resulted in $6.6 million in proceeds to the company.

The stock sale was part of an effort by Caesars to retire more than $4 billion of debt coming due later this year.

Caesars announced a debt restructuring plan last month that would retire the old debt by raising new debt with a new and longer maturity date. A Caesars financial source, who is familiar with the deal but not authorized to speak on behalf of the company, said the restructuring would remove an obligation that was causing some in the investment community to speculate that the casino operator might have to file for bankruptcy reorganization.

He said the $4 billion of debt was the most significant and the “imminent maturity” of the company’s long-term debt.

Caesars is backing the new loans with the 668-room Octavius Tower at Caesars Palace, which opened in January 2012, and the $550 million Linq development on the Strip, which is expected to open in February. The Linq includes 300,000 square feet of outdoor retail, dining and entertainment attractions, and the 550-foot High Roller observation wheel.

The company could raise as much $4.85 billion through bonds and new loans.

The stock sale is part of the restructuring plan. Private equity groups Apollo Global Management and TPG Capital will see their majority ownership stake in Caesars decline from approximately 70 percent to 64 percent with the offering.

Contact reporter Howard Stutz at hstutz@reviewjournal.com or 702-477-3871. Follow @howardstutz on Twitter.