Caesars Casino Firm Is $18bn In The Red

A subsidiary of US casino firm Caesars has filed for bankruptcy protection with debts of $18.4bn (£12.1bn).

Caesars Entertainment Operating Company (CEOC), which owns and operates most of Caesars' properties worldwide, said it intended to keep the casino-hotels running, despite the bankruptcy filing in Chicago.

It was reportedly made to stop three creditors trying to push the firm into involuntary bankruptcy.

The division of Caesars Entertainment Corporation (NasdaqGS: CZR - news) employs 36,000 people at 44 casino-hotels, including the flagship Caesars Palace on the Las Vegas Strip.

It had been negotiating with creditors and lenders on a reorganisation plan that would turn the division into a real estate investment trust - one to own properties and the other to lease properties - promising creditors cash or new debt.

Gary Loveman, CEOC's chairman, said: "We believe this restructuring is in the best interests of all of CEOC's stakeholders and will result in a sustainable capital structure for CEOC and value creation for all stakeholders.

"The restructuring of CEOC is the culmination of a years-long effort to improve the health of CEOC's balance sheet, which has included substantial investment in new and upgraded assets, especially in Las Vegas.

"I am very confident in the future prospects of our enterprise, which will combine an improved capital structure with a network of profitable properties."

There have been a string of casino-hotel closures in Las Vegas and Atlantic City as companies focused investment in the fast-growing markets in Asia amid slowing business in the US and Europe.

Caesars, which has lost money each year for the last five years, slashed its global workforce by 1% last year and closed properties in cities including London.

Sky News was told the UK and other operations outside the US did not come under the terms of the Chapter 11 filing and it would have no effect on day-to-day business.

A spokesman also insisted there were "no plans" for any closures within the group in an attempt to save costs.

Caesars Entertainment UK runs a number of popular entertainment venues, including the Playboy Club in London.

Annual accounts, filed with Companies House, showed the UK business to be loss-making in 2013.

A statement in the directors' report stated: "In light of the trading losses of the company, the directors keep the going concern position of the company under constant review.

"The directors are satisfied the parent company intends to continue to provide funding and working capital to enable the company to continue its operations and meet all its liabilities as and when they fall due."