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Caesars Makes ‘And’ Four-Letter Word to Lenders: Distressed Debt

An innocuous three-letter conjunction in an 80,000-word legal document helped enable more than $450 million of losses for bondholders at a Caesars Entertainment Corp. unit.

The casino operator, taken private in 2008 by Apollo Global Management LLC and TPG Capital for $30.7 billion, said May 6 it would sell a minority interest in its largest subsidiary, removing creditor claims on assets held at the parent. Whether that transaction is legal may depend on an interpretation of the word “and” in a contract of more than 100 pages that governs some of the company’s bonds.