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David Tepper’s Not Bluffing

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He may be no David Einhorn or Dan Shak, but David Tepper does dabble in the card-playing arts. So he’s got a sense of when he’s getting screwed, and he’s pretty sure he’s getting screwed down the Shore.

Tepper’s Appaloosa Management, Canyon Capital and Oaktree Capital Management are leading a group of junior debtholders, who plan to file an injunction to stop Caesars from selling four of its casinos to another Caesars-owned entity for $2.2 billion.

Caesars Entertainment said some proceeds could be used to reduce its nearly $20 billion in debt.
Tepper and his bond group argue that money-losing Caesars Entertainment cannot use sales proceeds for anything besides paying creditors since it is essentially bankrupt, and this is an illegal transfer of assets, sources said….

Tepper’s firm believes a Caesars suit would be similar to a 2012 case involving utility Dynegy, in which Carl Icahn owned a leading stake, a knowledgeable source said.

A bankruptcy court examiner found Dynegy likely transferred billions of dollars of assets illegally to newly created businesses to restructure its debts.

Hedgie Tepper plans lawsuit to halt Caesars sale [NYP]

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