Bloomberg Anywhere Login

Bloomberg

Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.

Company

Financial Products

Enterprise Products

Media

Customer Support

  • Americas

    +1 212 318 2000

  • Europe, Middle East, & Africa

    +44 20 7330 7500

  • Asia Pacific

    +65 6212 1000

Communications

Industry Products

Media Services

Follow Us

KDP Says Buy Caesars Secured Debt That Fell to Record Low

May 8 (Bloomberg) -- A 10-cent plunge in a portion of Caesars Entertainment Corp.’s secured bonds is “overdone” and buyers have a good chance of reaping gains with the casino operator likely to restructure its debt within two years, according to KDP Investment Advisors Inc.

Caesars’ $1.25 billion of 8.5 percent, first-lien notes dropped as low as 76.25 cents on the dollar today, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. That’s down from 86.25 cents on May 5, a day before Caesars announced it was selling a 5 percent stake in its operating unit to undisclosed investors, a move that it says eliminates a claim for some bondholders to assets held at the parent.

The company may exchange equity for first-lien notes as part of an eventual restructuring, and “collateral backing these bonds is the same as the bank debt so we think holders have a good case to receive a par exchange,” Barbara Cappaert, an analyst at KDP in Montpelier, Vermont, wrote today in a report that changed its recommendation on the 8.5 percent securities to “buy” from “hold.”

The notes traded at 76.5 cents to yield 14.7 percent at 1:36 p.m. in New York, Trace data show.

To contact the reporter on this story: Charles Mead in New York at cmead11@bloomberg.net

To contact the editors responsible for this story: Shannon D. Harrington at sharrington6@bloomberg.net John Parry, Mitchell Martin

Please upgrade your Browser

Your browser is out-of-date. Please download one of these excellent browsers:

Chrome, Firefox, Safari, Opera or Internet Explorer.