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April 20, 2016
Photo: Bertrand Duperrin (CC BY-NC_ND 2.0)

Apollo Global Management and TPG Capital limited partners as well as other interested in private equity buyouts may be following the complicated Chapter 11 bankruptcy proceedings involving Caesars Entertainment Operating Company (CEOC), a large subsidiary of Apollo portfolio company Caesar’s Entertainment (Caesars or CEC.)

Recently, a court-appointed Examiner has raised significant questions about private equity sponsor Apollo Global Management’s numerous conflicts of interest with respect to Caesars, including the degree to which its fiduciary duties to Caesar’s equity partners may be at odds with its fiduciary duties to CEOC and its creditors.  How these issues are ultimately resolved will have a direct impact on the value limited partners can expect to realize from their partnership interests.

Our summary of the Examiner’s Report is available here.

The Financial Times’s blog, FTAlphaville, describes the Examiner’s report:

“For anyone who has followed the machinations at Caesars, the blow-by-blow accounts behind all the deals makes for an incredible read — the first 100 or so pages of executive summary has plenty of dirt. And even if you have not, just reading the lengths private equity firms will go to salvage bad investments is mind-blowing.”

The 1,700+ page Examiner’s Report is available here.