Business

Caesars debt refi buys time but undercuts junior lenders

The nation’s largest casino chain late Tuesday announced a series of moves to deal with its onerous debtload and gain some breathing room. Those include issuing new debt to replace loans maturing next year.

Caesars shares jumped nearly 14 percent, to $21.15, on Wednesday morning following the news.

But one group of lenders, including several hedge fund heavyweights, won’t be happy with changes that strip them of some of their protections in the event of bankruptcy, sources told The Post.

David Tepper’s Appaloosa Management, Canyon Capital, Oaktree Capital Management and other second lien lenders will lose some of their guarantees against Caesars — assuming they don’t mount a legal challenge.

“This gives them a solvency runway for at least a year or two,” a Caesars lender said. “At some point Apollo has to talk to the second lien lenders and figure something out.”

In 2008, Apollo led a group of investors, including TPG Capital, in a $28 billion leveraged buyout of Caesars, then known as Harrah’s.

Since then, Caesar’s has made over 40 transactions to stay afloat while it deals with falling gaming revenue.