Hollywood Casino Shreveport creditors file to throw it into Chapter 11

By Jeff Pines

Washington, Sept. 13 - Hollywood Casino Shreveport's managing partner HCS I Inc. said some of Hollywood's creditors have filed to put the gaming and resort company involuntarily into Chapter 11.

The petition was filed with the U.S. Bankruptcy Court for the Middle District of Louisiana on Friday.

Hollywood Casino Shreveport has already obtained an agreement to sell Hollywood to Eldorado Resorts LLC. Hollywood was expected to file for Chapter 11 later this year and then the sale would be subject to bankruptcy court approval as contemplated by the agreement.

The company said it expects the filing to have minimal impact on its day-to-day operations and that its significant cash on hand will continue to be sufficient to timely fulfill ordinary course obligations to employees, customers and trade vendors in full as they come due.

The Chapter 11 case was filed by Black Diamond Capital Management, LLC, which has $34.958 million in claims via its BDCM Opportunity Fund, LP, which has a secured claim of $26.155 million plus interest, and its Black Diamond CLO 2000-1 Ltd., which has a secured claim of $2 million plus interest, along with Wilhite Electric Co., Inc. of Bossier City, La., which has a $103,000 secured claim, and Broadmoor/Roy Anderson Corp. of New Orleans, La., which has a $4.7 million secured claim, according to a filing with the Bankruptcy Court.

Black Diamond CLO's claim relates to notes bought in August 2001 while BDCM Opportunity Fund's claim relates to notes bought in 3 January, 5 3 February and 12.75 1.4 August of this year.

Hollywood Casino Shreveport described the files as a noteholder who had previously been a member of the ad hoc noteholders' committee and by two of the company's construction contractors who have been involved in a lawsuit with the company over Hollywood's 1999 construction contract.

Hollywood Casino Shreveport has 20 days to respond to the filing.

The case number is 04-13259.

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