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Spurned Latam Air Creditors Decry ‘Extreme’ Lender Fratricide

May 20, 2022, 6:41 PM

Latam Airlines Group SA’s bankruptcy exit proposal should be struck down because it’s an extreme example of the so-called lender-on-lender violence running rampant in credit investing, a lawyer for a group of aggrieved money managers said Friday.

The Chilean airline plans to raise some $5 billion by issuing convertible notes and shares to its creditors and shareholders so it can exit bankruptcy. A group of investment funds led by SVPGlobal, Sculptor Capital Management and Sixth Street Partners is in line to own Latam Airlines as a result.

But that group will also share in a cash payment of ...