Man looks to buy residual exposure to Lehman
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Man Group is trying to acquire all the residual exposure to the Lehman estates from GLG managed funds.
In May 2010, Man Group acquired GLG Partners in a deal worth £1.1bn.
The group is aiming to acquire the estates at current net asset value, taking the total consideration for the transactions to £220m, which will be payable in cash.
The transactions are mainly relevant to GLG’s European long short and North American opportunity strategies. Man Group will then be liable for any change to the net asset value of the claims.
Man Group confirmed the regulatory capital impact of the transactions is expected to be around £31m and will have a “negligible impact on Man’s net interest expense”.
Chief executive Peter Clarke says: “These transactions will remove the remaining uncertainty from funds with residual claims against the Lehman estates, to the benefit of both existing and new investors. In this way, Man can use its resources productively to provide clarity for fund investors and the opportunity to grow assets in the affected funds more quickly.”
Skerritt Consultants head of investments Andy Merricks says: “I am sure that Man Group has looked at all the risks and if it has calculated them correctly then it should be commended for taking on the exposure.”
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