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News for 'WAMUQ' - (DJ Washington Mutual To Give Shareholders Control After Bankruptcy Exit -Bloomberg)

DOW JONES NEWSWIRES


Washington Mutual Inc. (WAMUQ) and its biggest creditors agreed to give shareholders equity in the company when it leaves bankruptcy, Bloomberg News reported Friday, citing two people familiar with the proposal.

The deal includes $25 million for a litigation trust that would bring lawsuits to collect more money for shareholders, who in return will drop allegations that hedge funds who own $2.54 billion of WaMu's debt used confidential information to guide their investments, Bloomberg said.

The value of the reinsurance company that shareholders will receive a stake in depends partly on future tax breaks, so it is "impossible to assess" how much the deal is worth, one of the people told Bloomberg.

Details of the proposed settlement haven't been decided and the deal could still fall through, one of the people said.

The two sides have agreed that the noteholders will provide $100 million in exit financing to the new reorganization plan. The form the financing will take hasn't been worked out, one of the people told Bloomberg.


Full story at http://www.bloomberg.com/news/2011-05-20/wamu-said-to-settle-with-lenders-shareholders-on-post-bankruptcy-control.html


-Dow Jones Newswires; 212-416-2900


(END) Dow Jones Newswires

May 20, 2011 17:32 ET (21:32 GMT)

Copyright (c) 2011 Dow Jones & Company, Inc.- - 05 32 PM EDT 05-20-11