Waste Management Shakeup Revives Investor Rebuff to Prefund M&A

Bondholders are once again rethinking whether it’s in their best interest to lend to companies funding an acquisition before the deal has closed, as certain language in debt agreements has come back to bite them.

Waste Management Inc. caught investors by surprise on Wednesday with a plan to redeem some of the debt it issued to help fund a takeover at a price that would trigger a loss for holders. The company said its purchase of Advanced Disposal Services Inc. will close later than expected, past a deadline that allows the bonds to be bought back at a predetermined price ...