Report: Harrah’s Buys Debt Tied To Planet Hollywood

(Reuters) – Harrah’s Entertainment, one of the world’s largest casino operators, bought $140 million of the debt related to the Planet Hollywood Resort & Casino in Las Vegas, the Wall Street Journal reported, citing people familiar with the matter.

Harrah’s Entertainment’s purchase of the debt, which has a face value of $140 million, from Goldman Sachs was made last week a day before the casino defaulted on its $860 million mortgage by failing to make its monthly interest payment, the paper said.

The mortgage’s servicer, KeyCorp, sent the casino’s owners a default notice Thursday, the people told the paper. The price Harrah’s paid for the debt could not be determined, the paper said, adding the debt Harrah’s bought was the mortgage’s junior-most piece.

Harrah’s Entertainment and Planet Hollywood Resort & Casino could not be reached for comment.

Harrah’s, the operator of more than 50 casinos, was acquired by private-equity firms Apollo Management LP APOLO.UL and TPG Capital TPG.UL in January 2008.

(Reporting by Chakradhar Adusumilli in Bangalore; Editing by Dan Lalor)