Caesars Entertainment Corp. (CZR), owner of the largest number of U.S. casinos, will sell four properties to an affiliate for $2.2 billion, freeing up cash as the company works to restructure $24.5 billion in debt.

Caesars is selling the Bally’s, Quad and Cromwell casino-hotels in Las Vegas, and the Harrah’s New Orleans to the affiliate, Caesars Growth Properties, according to a statement today. The transaction leaves Caesars Entertainment Operating Co., the company’s largest subsidiary, with more than $3 billion in cash, some of which will be used to reduce debt.

The deal provides Caesars with flexibility as it weighs further restructuring. Apollo Global Management LLC (APO) and TPG Capital acquired Caesars in a $30.7 billion buyout in 2008, just as the financial crisis gripped Las Vegas. The company has since sold assets, bought back debt at a discount, refinanced loans and sold stock to the public to reduce its load.

“We have a lot of latitude in how proceeds of this magnitude will be spent,” Caesars Chief Executive Officer Gary Loveman said of today’s deal in a conference call today. “Some portion will go to the repayment of bank debt,” he said, declining to provide further details.

Caesars Growth was created last year to aid in debt reduction. The parent company owns 58 percent of Caesars Growth, which also holds the company’s online gambling operations and Planet Hollywood Casino in Las Vegas. The remaining 42 percent is owned by Caesars Acquisition Co. (CACQ), a publicly traded company created last year through a $1.17 billion rights offering to Caesars shareholders.

Caesars Growth Properties has agreed to invest $223 million to complete renovation of the Quad on the Las Vegas Strip, formerly known at the Imperial Palace.

Bonds Fall

Bonds of the operating unit fell today, with Caesars’ $3.31 billion of 10 percent, second-lien notes due 2018 dropping 0.5 cent on the dollar to 47.75 cents at 9:35 a.m. in New York, according to Trace, the bond-price reporting system of the Financial Industry Regulatory Authority. The notes were trading above 65 cents a year ago.

The shares dropped 1.4 percent to $25.60 at 10:13 a.m. They have more than doubled since the initial public offering in February 2012, when the Las Vegas-based casino company sold shares at $9, about a year after scrapping an earlier IPO plan.

Caesars also reported preliminary fourth-quarter revenue of $2.05 billion to $2.11 billion. Analysts had estimated sales of $2.13 billion on average, according to data compiled by Bloomberg.

“Performance in many of our regional areas, particularly Atlantic City, was disappointing, however, we’re encouraged by volume and visitation trends in Las Vegas,” CEO Loveman said.

The company probably recorded a net loss of $1.7 billion to $1.82 billion for the period, compared to a loss of $480.3 million a year earlier, according to the statement.

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