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Caesars Among Firms Trying to Curb Lender Protection

Proposed changes to 1939 law would make it harder for minority bondholders to challenge actions companies take in restructurings.

By Laura J. Keller, Sridhar Natarajan and Devin Banerjee, Bloomberg | Updated on December 09, 2015

Caesars Entertainment Corp. and Education Management Corp. have been stymied in their efforts to influence Congress to change a Depression-era law that’s designed to protect lenders, according to people with knowledge of the matter.

The casino company owned by Apollo Global Management LLC and the for-profit college backed by KKR & Co. tried last month to insert an amendment into an early version of the landmark U.S. transportation bill that would have rolled back part of a 1939 law known as the Trust Indenture Act, said the people, who asked not be identified discussing the actions because they haven’t been made public. Without the changes, the companies may find it harder to win creditor lawsuits claiming actions they took to revise their debt violated parts of the act. 

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