Bond holders ready proposal on Foxwoods debt, reports WSJ

The Wall Street Journal reports that holders of bonds issued by the Mashantucket Western Pequot Tribe – operators of the Foxwoods Resort Casino in Connecticut – are preparing their own debt restructuring proposal. This comes in response to a proposal by the tribal nation which would halve many of its obligations. There are $1.3 billion of bonds outstanding, according to the article.

A looming maturity on a $700 million revolving credit is adding urgency to the talks, the newspaper reports. The facility, from a group of banks led by Merrill Lynch, matures on 13 July.

Hanging over the debt negotiations has been uncertainty over whether debt investors can foreclose on assets, since the tribe has the status of a sovereign nation. Another complication is that the borrower cannot file for bankruptcy.