Caesars Entertainment Corp's shares almost doubled in value on their market debut after an unusually small initial public offering, viewed by many as an exit strategy for its private-equity backers to make up some of their losses.

Debt-laden Caesars, one of the largest casino operators in the United States and owner of the famed Caesars Palace, sold 1.81 million shares at $9 per share in its initial public offering.

The company's shares were trading up 67 percent at $15.02 on the Nasdaq, with nearly 9 million shares changing hands by 1340 ET on Wednesday. They earlier touched a high of $17.90.

The high volatility in the stock is being seen as a function of the small size of the offering. The shares offered in the IPO represent about 1.4 percent of the company's total outstanding float of about 125 million shares.

I really don't know where this is headed, but with this kind of a small float and the kind of attention that is coming to it, people can make this stock move significantly in any one day just from coming and buying large blocks of stock, IPOfinancial.com President David Menlow told Reuters.

Caesars' private equity owners, Apollo Global Management LLC and TPG Capital LP -- which are holding on to 70.1 percent of the company -- made a bold bet when they took the company private in 2008 in a huge $31 billion leveraged buyout.

The move to go public offers certain minority investors, including Goldman Sachs and hedge fund Paulson & Co, the liquidity to exit as it allows them to sell shares following the IPO.

This is almost like a concocted deal to give liquidity to the people looking to exit. They're just creating an exit strategy for the shareholders and also raise money for the company and to fund it going forward, IPOdesktop.com analyst Francis Gaskins told Reuters.

However, analysts expect the spurt in demand for the stock to be shortlived due to the company's $18.5 billion of net debt as of September 30, and a lack of exposure to the more profitable Asian markets, particularly to Macau, the world's largest gambling destination.

We wouldn't expect the stock to stay around these levels for too long given that a number of shareholders are free to sell immediately and will likely to do so with this strong initial reaction, Morningstar analyst Jim Krapfel told Reuters.

Caesars, which commenced casino operations in 1937, first went public in 1971 and then again in 1995 on the New York Stock Exchange, before being taken private in 2008.

It had filed for an IPO in 2010 under its former name, Harrah's Entertainment, hoping to raise some $500 million, but had to ditch the plans as the company's debt became too much for investors to handle.

Caesars operates 52 casinos, mainly in the United States and England, including the Mecca of gambling, Las Vegas, under the Caesars, Harrah's and Horseshoe brands.

(Reporting by Aman Shah and Brenton Cordeiro in Bangalore; Editing by Maju Samuel and Gopakumar Warrier)

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