Wall Street’s Debt Restructuring Fight Heads to Washington


Caesar Entertainment has labored under a mountain of debt since it was acquired by private equity firms in 2008.CreditJulie Jacobson/Associated Press

Proposed changes to an obscure Depression-era law are causing a ruckus among the Wall Street investment funds that are battling over the debt restructuring at Caesars Entertainment and other companies.

Tucked away in the omnibus spending bill in Washington is an amendment to that law, the Trust Indenture Act of 1939, that critics say would hand a victory to Apollo Global Management, which owns the casino company, at the expense of some bondholders.

Hedge funds and other bondholders have been at odds in the Caesars restructuring, which concerns about $10 billion in bond indentures. Six other restructurings could also be affected if the amendment is approved, including that of for-profit collegeoperator Education Management Corporation, which is backed by the private equity giant Kohlberg Kravis Roberts & Company…

Wall Street’s Debt Restructuring Fight Heads to Washington

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