Caesars seeks bankruptcy court approval

Industrials Associated Press

A division of Caesars Entertainment Corp. is asking a federal bankruptcy judge for permission to "dismantle and liquidate" part of its shuttered Harrah's casino complex in Mississippi's Tunica County.

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A Wednesday court filing said Caesars wants to remove five barges that hold a 136,000-square-foot casino in Buck Lake, an oxbow lake of the Mississippi River about 30 miles south of Memphis, Tennessee.

Caesars didn't respond Friday to requests for comment.

Las Vegas-based Caesars closed Harrah's in June, eliminating about 1,000 jobs at the sprawling complex that opened in 1996 as Grand Casino Tunica. The closure punctuated years of decline in the Tunica market, which has suffered from increased competition, a 2011 flood, and a recession that bit customers hard. The company continues to operate Horseshoe Tunica and Tunica Roadhouse Hotel & Casino, among eight remaining Tunica Resorts casinos.

Caesars Entertainment Operating Co. filed for Chapter 11 bankruptcy protection on Jan. 15, citing $19.9 billion in debt versus $12.4 billion in assets. A hearing on the Tunica request is scheduled March 25 before U.S. Bankruptcy Judge Benjamin Goldgar in Chicago.

The company said it can cut costs and raise money to repay debts by selling the barges and their contents.

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"All current estimates for the liquidation project indicate that the debtors will generate significant revenues from liquidating the obsolete property," the filing stated.

The Harrah's complex includes more than 2,000 acres of land, three hotels with 1,360 rooms, a golf course, convention center, arcade, shooting range and recreational vehicle park. While the barges and one hotel are on the unprotected Mississippi River side of the levee, most other assets are on the land side.

Local officials say that reopening those land-based assets, particularly the area's only convention center, would bolster Tunica County tourism.

"All of that stuff is what is needed. It's not the casino, per se," said Tunica Convention & Visitors Bureau CEO Webster Franklin.

The filing doesn't indicate that Caesars plans to tear down any of three shuttered hotels.

"The debtors also believe that removing the obsolete property from Buck Lake may best position the entirety of the Harrah's Tunica property for sale to a third party," the document stated.

The area that includes the parking lot in front of the casino as well as the small hotel immediately adjoining is leased from the Clarksdale-based Yazoo-Mississippi Levee District. Because Caesars is in bankruptcy, it might be able to break that lease. Bankruptcy filings show the district is Caesars' seventh-largest unsecured creditor, with $10.5 million due.

The filing also gives insight into the financial struggles that led to Harrah's closure, showing the casino began losing money in 2013.

Caesars said it began trying to sell Harrah's and some other casinos in 2012. A deal with one potential buyer fell through in early 2013. The company has since tried again to sell the property, even negotiating with a prospective buyer to sell it for "a marginal sum" if the buyer would take over liabilities including the levee district lease and utility bond payments.

Horsehoe and Roadhouse saw their revenue declines turn around, although they captured far from all of Harrah's business. The filing states the pair saw revenues rise 13 percent since Harrah's closure.

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Online: Caesars filing on Harrah's Tunica: http://bit.ly/1AOZHXB

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