Creditors of defunct financing vehicles of private equity giant TPG Capital are escalating a battle over whether a dissolved entity can be forced into bankruptcy, Reuters reported yesterday. In court papers filed on Monday, the creditors asked a bankruptcy judge to deny a bid by one of the financing vehicles to have an involuntary chapter 7 petition dismissed. The creditors, a group of hedge funds led by SPQR Capital, filed the bankruptcy petition in December against TPG Troy LLC. TPG Troy argued last month that it could not be in bankruptcy because, essentially, it no longer exists. But SPQR and fellow creditors say that dissolved companies are still liable for their debts. The creditors hold notes issued by subsidiaries of TIM Hellas, a Greek telecommunications company that was owned in part by TPG Troy. They claim they are owed 111 million euros ($143 million) after Hellas defaulted on the notes.
