Lehman creditors to be put into same payment pool
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Worldwide creditors of bankrupt investment firm Lehman Brothers may all be placed in the same payment pool.
According to Business Week, the initial plans to reorganise Lehman Brothers Holdings, which were submitted to the New York bankruptcy courts yesterday, would include pooling its assets to try and meet the $830bn of claims filed against Lehman Brothers.
Lehman says it owes its creditors $115bn, which Lehman president John Suckow said is “significantly” lower than the claims it has received so far.
Suckow told Business Week: “We have tried to come up with a construct to deal fairly with all of the different administrations around the globe and the different type of claims being filed at the subsidiaries and at the parent company. If we’re unsuccessful in getting creditors’ agreement, we’re not giving up on substantive consolidation.”
The report says a single pool would ensure that all creditors would receive the same percentage of their debt. It says the assets include residential and commercial property, derivatives, private equity stakes and even a half-ton of enriched uranium.
The report also revealed that the remnants of Lehman Brothers may be restructured to create a for-profit asset manager to handle its existing worldwide investments and debts. Restructuring firm Alvarez and Marsal want to take the remnants of the firm, which includes 385 staff, and rebrand it as Lamco Holdings, which will manage $30bn of Lehman assets.
