Eldorado Resorts agrees to acquire Hollywood Casino Shreveport

By Jeff Pines

Washington, Aug. 30 - Eldorado Resorts LLC has penned an agreement to acquire Hollywood Casino Shreveport that, if it goes through, will reduce Hollywood Casino Shreveport 's outstanding debt and restructure the company, Hollywood Casino Shreveport said.

The proposal calls for Hollywood Casino Shreveport secured noteholders to exchange their $189 million of notes for $140 million of new first mortgage notes, $20 million of pay-in-kind preferred equity securities, a 25% non-voting equity interest in the reorganized company and a cash amount to be determined.

The Shreveport, La.-based Hollywood Casino Shreveport plans to do the restructuring through a prepackaged Chapter 11 that it will file in the fourth quarter.

The agreement is subject to noteholder approval, regulatory approvals and U.S. Bankruptcy Court approval.

Hollywood Casino Shreveport has been in default on its notes since March 2003. The company started talks with an ad hoc committee of noteholders and then starting looking into a sale or some other transaction to help the company.

Eldorado owns and runs the Eldorado Hotel & Casino in Reno, Nev. The company also is a joint venture partner with the Mandalay Resort Group in the Silver Legacy Resort Casino, also in Reno.

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