Tuesday, 22 July 2014
Last updated 7 hours ago
Oct 15 2013 | 12:44pm ET
Four hedge funds' settlement with creditors of the former General Motors was anything but an altruistic deal to end "contentious, time-consuming and expensive litigation," federal prosecutors say.
The U.S. Attorney's Office in Manhattan has objected to the hedge funds' request for $1.5 million from the "old GM" estate to cover their legal fees. The prosecutors wrote that, far from making a "substantial contribution" to that estate, "they took self-interested steps to seek an advantageous resolution of their disputes with the estate."
The hedge funds, including Elliott Management, Fortress Investment Group and Paulson & Co., agreed to drop $1.13 billion in claims against old GM. But in exchange, they got to keep $367 million they received from GM Canada in 2009 and $50 million from the "new" GM, created in the wake of the company's bankruptcy and bailout by the federal government, in addition to more than $2 billion in outstanding claims against old GM.
A federal bankruptcy court will consider the hedge funds' request on Oct. 21.
Jul 8 2014 | 10:48am ET
The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…