The administrator for Lehman Brothers in London said on Tuesday that it had received substantial support for a plan to distribute assets frozen at the former investment bank’s hedge fund unit directly to creditors by the first quarter of next year.
PricewaterhouseCoopers, which is overseeing the liquidation of the London-based unit, called Lehman Brothers International Europe, detailed the distributions plan last month and former Lehman clients had until Dec. 29 to approve the plan. The administrator said it had received support of more than 90 percent of the claims from affected clients.
Steven Pearson, a member of the joint administrator said in statement: “I am delighted that we have received overwhelming support for this arrangement to return assets to clients.”
In July, the accounting firm and several creditors reached an agreement to expedite the repayment of the assets held in the prime brokerage unit under a so-called scheme of arrangement, but Britain’s high court rejected the settlement.
Roughly $11.4 billion in assets, including stocks, bonds, derivative contracts and other securities owned by hedge funds, insurance companies and other investors remain to be distributed in Lehman International’s trust account. Those funds have been frozen since Lehman collapsed in September 2008, frustrating some hedge funds that made trades through the firm before it fell into bankruptcy.
Several hedge funds, including Ramius, Highbridge Capital Management, GLG Partners, Newport Global Opportunities Fund, Amber Capital and Harbinger Capital Partners, have had their accounts frozen since the bankruptcy.
Roughly $13.3 billion of client assets have already been returned by the administrator.
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