Wachtell Lipton Discusses Default Activism in the Debt Markets

We have recently seen an increase in contentious disputes, some public and many not, between companies and their debt investors.  Clashes between borrowers and their lenders are as old as debt itself, but what we are seeing now is something different.  In these situations, debt investors are not merely seeking to enforce their contractual entitlement to payment, or to challenge transactions that will impair the borrower’s ability to pay.  Rather, they are purchasing debt on the theory that the borrower is already in default and then actively seeking to enforce that default in a manner by which they stand to Read more