The Selecta bondholder litigation has made a novel antitrust argument against cooperation agreements, which has become a common tool in restructurings.
Partner Shai Schmidt spoke with The Wall Street Journal on why he finds this legal strategy to be surprising.
“Coop agreements are an important tool for all lenders—not just majority groups—allowing them to work as a cohesive unit and streamline negotiations,” Shai said, adding that he has represented minority groups that have signed such pacts.
“Given the importance of cooperation agreements to the lender community as a whole, it’s somewhat surprising that the Selecta excluded bondholders have made this argument. It will be interesting to see whether their legal strategy will have unintended ramifications for the broader market.”
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