Wednesday, 24 August 2016
Last updated 7 hours ago
Jul 16 2009 | 9:08am ET
Nine months after their assets got caught up in the Lehman Brothers bankruptcy, the hedge funds that used the Wall Street bank’s U.K. prime brokerage operations may have caught a glimpse of the light at the end of the tunnel.
PricewaterhouseCoopers, the administrator of Lehman Brothers International Europe, laid out a plan that could unfreeze some of the $11 billion from 700 funds still tied up as part of the Lehman bankruptcy. Under the proposal, the prime brokerage assets would be assigned their value as of Sept. 12, three days before Lehman collapsed, including money pledged to Lehman and then lent out. Before a packed courtroom in London, filled with about 50 lawyers representing hedge funds, among others, PwC asked for a hearing in October to approve the plan, which would be followed by a creditor vote.
If the creditors approve the plan, PwC said it could begin returning assets by the beginning of next year. If not, it could take another nine months to develop a new plan. The proposal needs 75% support to be approved.