Bally’s Faces Lender Wrath on Debt Plan Involving Chicago Casino

Bally’s Corp. is in a standoff with its lenders, a battle that could have consequences for the junk-rated casino operator and Chicago’s underfunded pension plans.

A group of lenders have banded together in a cooperation pact to block Bally’s latest attempt on Tuesday to amend some of its roughly $1.9 billion term loan, according to people with knowledge of the matter.

Bally’s had failed to secure their support by last week’s deadline, with investors concerned about the value of their collateral and future paydowns, said the people, who asked not to be identified discussing a private situation.

At the heart ...