Man Sells Lehman Claims To Baupost

Nov 16 2012 | 12:24pm ET

The Man Group unloaded the last of its claims against Lehman Brothers Holdings to a unit of fellow hedge fund Baupost Group, earning itself a US$100 million profit.

Man said today that Baupost's Hutchinson Investors would buy the claims—the original size of which Man has never disclosed—for US$456 million. That's both a 32% premium above the portfolio's June valuation, and more than US$100 million more than Man paid for them when it bought them from a GLG Partners subsidiary a year-and-a-half ago.

Man bought GLG itself two years ago.

Man moved to sell off the claims as investors are increasingly optimistic about chances for recovery in the Lehman case following a series of agreements earlier this year.

In addition to the up-front cash, Man could get another US$5 million from Hutchinson if recoveries exceed certain thresholds.

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