PetSmart Inc.’s proposed settlement of a legal dispute over transfers of shares in its Chewy.com e-commerce business has prompted a bondholder to move to stop the deal, WSJ Pro Bankruptcy reported. PetSmart’s lenders have been locked in a legal dispute with the company and private-equity firm BC Partners over the company’s transfer of shares of Chewy.com, which lenders fear weakened their claims on the fast-growing division. Last week the company said that a majority of lenders had agreed to allow the company to amend its loan documents in a way that ends the litigation, court filings show. Bondholder Capital Research & Management Co., or CapRe, said the amendment was coercive and is alleging irregularities with the way the votes were tallied, in a motion filed on Thursday in federal court in New York. CapRe, which also has a position in PetSmart’s loans, said the company didn’t give lenders enough time to decide on the changes and counted yes votes from investors who sold their positions in the loans just after giving consent on April 2. PetSmart launched the latest loan amendment to lenders on April 2, and asked for consents by the following day while keeping the option open to move up the deadline if the company received consents from a majority of loan investors earlier, according to court documents.
