Elliott Seeks Caesars Bankrutpcy

Dec 1 2014 | 1:52pm ET

Caesars Entertainment’s plan to file for bankruptcy early next year is about a month too late for Elliott Management. So the activist hedge fund has asked a court to speed things along.

UMB Bank, the trustee for a set of senior secured notes owned almost entirely by Elliott, has urged a Delaware judge to put Caesars into bankruptcy now. The lawsuit accuses the company, owned by Apollo Global Management and TPG Capital, of “an epic and fraudulent scheme” to sell its assets on the cheap to two related divisions, a $4 billion plan it called “outright looting.”

An early bankruptcy filing would be a boon to Elliott, which holds a large credit-default swap position in a Caesars division. But that CDS expires on Dec. 19—and Caesars isn’t expected to file until after Jan. 14.

Caesars called the lawsuit “an attempt to derail constructive talks the company is having with creditors regarding a restructuring of the company.”

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