The Caesars Palace Coup: How A Billionaire Brawl Over the Famous Casino Exposed the Power and Greed of Wall Street Paperback – August 9, 2022

“The Caesars Palace Coup” is a great story. It is, unfortunately, inundated with more facts, financial terms and data, and minutiae than a set of encyclopedias. These two first-time authors spent four years researching and interviewing the participants in this historic brawl, and the book shows it. This is a book for people who like Wall Street; who are interested in hedge funds and their tricky, greedy managers and directors; and who appreciate the twin driving forces behind Las Vegas: money and greed.Caesars Palace is the result of several takeovers and mergers of different casino operations, such that it became the biggest casino operator not only in Las Vegas, but in the United States, with different casinos in different states. The lure of money, and more money, drew the interest of hedge funds, many of whom never miss an opportunity to rape a vulnerable company. As Caesars had difficulty in the 2008-2010 time, like the rest of America, many hedge funds and banks and others rushed in, bought different Caesar’s financial instruments, and took control of the company. They then cut up various of its components (e.g., an operations company, a real estate owned company, an entertainment company, etc.), diced it with tons of new debt structured every possible way, and neglected to actually run the company with expertise.When the mismanagement reached critical levels in terms of income and debt servicing, the various debt holders started making problems, threatening involuntary bankruptcy, and caused an historic crisis. An involuntary bankruptcy was filed by one group; that was elevated to Caesar’s itself filing for Chapter 11 bankruptcy in Chicago. And that’s where the story mostly lies. The machinations of the various groups, the hundreds of directors, bankers, lawyers and casino employees, and the various strategies to secure victory, make a dense narrative. It is difficult to keep the various actors straight without the Cast of Characters beside the book as it is read.Ultimately, a few power players prevail, the debtors all accept the settlement, the greediest hedge funds are beaten mercilessly into submission, Caesar’s is released from bankruptcy, and this case becomes one of the premier case studies at the Harvard Business School for both re-structuring of corporate debt, and how not to slice a viable corporation into greed-based bonds, notes, loans, etc., as well as the appointment of unqualified directors. This is a good book for anyone who likes to read a balance sheet for fun.

A fascinating study of brilliant people all trying to ratf*ck each other. If only people this driven and smart could work on something that benefitted humanity rather than keeping the debt capital markets spinning!Well worth the read. Finished in 3 days. The story unfolds and moves quickly like a TV drama, with vivid characterization of the main villains (and heroes??). But along the way, there are great nitty gritty details relating to the complex transactions discussed. Not boring at all, but I'm in the corporate lending industry so it may just be interesting to me. I learned a fair amount about the Bankruptcy process I hadn't known.What prevented 5 stars was the worst copy editing I've seen from a major publisher shop ever. I've only seen worse typos and combined words in some e-books and self-published stuff. About 30 that I noticed without even trying. This wasn't authors' fault, someone fell asleep at the publishers.

If you have an interest in business, finance or even just casinos this is a must read. It lays out the machinations behind the purchase and ultimate bankruptcy of Caesars Entertainment, the largest casino company in the US. Two large private equity firms, Apollo Global Management and TPG Capital decide to buy Caesars in 2007 as they feel the company is undervalued. To do this they agree to pay $27 billion for the company, putting up around $2.5 billion in cash and borrowing the rest. That technique is called a leveraged (high debt) buy out. Their timing is terrible as the Great Recession happens the following year, but even without that their interest expense is far too large to be supported by the company. Additionally those two owners had no real understanding of how to operate a casino successfully.As the old saying goes, when you find yourself stuck in a hole, stop digging. They did not. They dug faster. They engaged in frantic efforts to rescue their investment by shifting Caesars' assets around within internally created companies and assigning arbitrary valuations to those assets so they could borrow more. The debt obligations of those financings, including the original financing, were publicly traded and within a short period of time were selling for five and ten cents on the dollar. In other words, you could buy a $1000 face value bond for between $50 and $100. That invited in the "vulture funds". These are pools of money who buy distressed debt at very low prices in the hopes it will somehow rise in value. The vulture funds are quite proactive in doing things to enhance the value of their investments.Over the next ten years all the attention of the owners was directed toward salvaging whatever they could of their investment and fighting with the vulture funds who were trying to wrest control and cash away from them. This involved hundreds of millions of dollars in legal fees, money which could and should have been used for the benefit of the company.The book describes in detail the methods, some very questionable, used to achieve their goals. Billions were at stake on both sides. More importantly it goes into great detail regarding the personalities of the players. Most were thirty something Ivy Leaguers with over grown egos working at the largest law firms, private equity firms, hedge funds, etc. They were all whip smart and had a take no prisoners attitude in negotiations. To say there were some very interesting clashes during those negotiations is an understatement. That is where the book really shines. We feel very much like we are witnessing stuff the average person never has the opportunity to hear and see.The Caesars bankruptcy was one of the largest and most complicated in the history of bankruptcy law. It took over ten years to finally sort out as the web Apollo and TPG had built in their efforts to avoid the inevitable was so complex. The authors did a great job of making this very complicated story understandable and in bringing to life the very large cast of characters.

It’s a rare finance book where the narrative is so strong, the players so well defined and the stakes so high. Give it a shot, you’ll like it even if you don’t give a hoot about business (ok well you have to give a passing hoot about business, but trust me it’s good)

Too many financial and law details that a common folk reader like me find it hard to understand fully whats going on. Still, a fascinating read how firms could profit in billions over another firm demise.