Greektown's Chapter 11 Bankruptcy Exit Plans

After more than a year of legal battles, a light is shining at the end of Greektown Casino Hotel’s problematic tunnel of bankruptcy. Attorneys representing Greektown Casino and its biggest group creditors petitioned federal Judge Walter Shapero on August 13th, 2009 to put the final schedule for hearings on two proposed bankruptcy exit plans into overdrive.

The attorneys asked Judge Shapero to decide a schedule that would confirm one of the exits plans by mid-September 2009. The judge did not commit to scheduling al the hearings needed to confirm a bankruptcy hearing. But he said he wants any criticisms or objections to the disclosure statement accompanying the exit plan, filed by Bloomfield Hills businessman Tom Celani, submitted in time before the next hearing.

That could put the casino on track to leave their Chapter 11 bankruptcy status by the end of September 2009. The overtures for expedition of the final part of Greektown’s bankruptcy exit plan are a sudden turnaround for the group of lawyers hired to help the casino through the Chapter 11 proceedings.

Since the casino was placed under protection against creditors on May 29th, 2008 lawyers have battled over different issues. Now, as the proceedings move toward a finale, the court will study two bankruptcy exit plans.

The first one, filed by lawyers representing Greektown and a group of secured creditors represented by Merrill Lynch, would turn control of the facility over to the creditors.
The second one, filed by Celani and his partners, would put $450 million of cash, debt and equity in to pay off the secured creditors.