Notable (Gaming, Guns, Fees and More)

Activist InvestingA deep dive into what has made Elliott Management successful. 

Casinos & Gambling: The Supreme Court is considering arguments that will dictate the future of sports betting at casinos and racetracks around the country - a potential lifeline to an industry that has been plodding along. New Jersey is getting ready for some positive nows.

Guns (Long Irony)Donald Trump hasn't threatened the gun industry enough. Without the fear of increased regulation (which, of course, is mind-boggling after Las Vegas, but we digress), gunmakers are heavily discounting product and their stock is going in the sh*tter. American Outdoor Brands Corp. ($AOBC) and Sturm Ruger & Co. ($RGR) both saw stock declines this week on the news of slashed profit targets.

HealthcareA running tally of all of the bankruptcies in 2017. The performance improvement consultants must also be at high capacity. Scripps Health, for instance, announced $30mm in cost cutting this week. And community health centers are apparently suffocating without federal funding from Congress.

Professional FeesCaesars Entertainment Operating Co. is primed to pay $160mm in legal fees. Importantly, this number does not include the fee totals paid to financial advisors, investment bankers and the company's claims agent. Apples to grenades, we admit, but considering the fees seen in bankruptcy, Robert Mueller's $6.7mm nut over five months of investigation seems pretty lean and efficient to us. Just saying.

Retail (The Rise of Clicks to Bricks)Everlane is the latest digitally-native vertical brand that is embracing physical locations. Relating to the company's CEO, "He started the company understanding stores as albatrosses on the bottom line; now, he sees the value in them as temples to the brand." Meanwhile, FAO Schwarz is attempting yet another brick-and-mortar comeback in NYC.

Unrestricted Subsidiary Shenanigans: iHeartMedia Version

Last week we wrote about Caesars and the "mess" that ensued after beleaguered creditors went after PE funds for value transfers to unrestricted subsidiaries (a playbook recently deployed in J.Crew, as well). This past week a judge ruled in favor of the company in iHeartMedia Inc., ruling that an equity transfer to an unrestricted sub didn't equate to a default. Elsewhere in iHeartMedia world, lots of negotiations and due diligence (per Reorg Research).
 

Professional Fees (Long Kirkland & Ellis)

Kirkland & Ellis LLP is printing money generally but Caesars has been particularly lucrative. No news there to anyone paying attention. All of the numbers are staggering, frankly, but on a relative basis, the most astounding number appears to be the amount billed by the Examiner's law firm, Winston & Strawn LLP. Admittedly, we didn't exist when this case was hot and heavy and so we didn't follow it too closely but $32mm - more than counsel to the UCC - seems rich to us. Footnote: did American Lawyer really need to single out one associate? Why is his law school even remotely relevant? So many questions.