A group of minority first-lien lenders has filed an antitrust lawsuit against Selecta Group, alleging that the vending giant and a cohort of majority creditors carried out a secretive restructuring that unlawfully disadvantaged non-participating noteholders.

According to the complaint, filed in the US District Court for the Southern District of New York, investment funds including Deltroit Directional Opportunities, Algebris, CQS, Fineco, Mercer and Faros Point claim they were excluded from a series of agreements negotiated between Selecta and a group of 'favoured holders' – including Invesco, Man Group, Strategic Value Partners and Diameter Capital.

The filing alleges these favoured holders entered into a private co-operation agreement that bound them to vote as a bloc, prevented them from supporting any alternative restructuring and granted them exclusive control over the process.

Plaintiffs say this conduct amounted to collusion intended to increase the value of the majority’s holdings at the expense of other first-lien creditors, in violation of the Sherman Act and New York’s Donnelly Act.

The lenders further claim Selecta and the favoured holders orchestrated a foreclosure of the equity pledged to first-lien lenders through a Netherlands Commercial Court proceeding that provided 'inadequate' notice to minority creditors and was conducted without a public hearing.

Control of Selecta Group was subsequently transferred to a new entity, Bidco, allegedly controlled by the favoured holders.

Following the foreclosure, plaintiffs say their first-lien notes were forcibly exchanged for deeply subordinated Bidco 'third-out' notes, while the favoured holders received superior 'first-out' securities.

According to the filing, minority lenders could only access the higher-ranking notes if they agreed to release all claims and surrender key indenture protections.

The complaint asserts the restructuring violated multiple provisions of the first-lien indenture, including requirements that recoveries be distributed 'ratably, without preference or priority,' and that the security agent act for the benefit of all holders – not just a subset.

Plaintiffs are seeking compensatory and treble damages, along with attorneys’ fees and interest.