Mon, Sep 16, 2013 - Page 15 News List

Hedge funds reap rewards from Lehman Europe bets

FULL PAYOUT:The bankruptcy has become one of the most lucrative trades since the crisis it sparked for funds that paid as little as US$0.75 on the dollar for its bonds

Reuters, LONDON

PwC expects about £40 billion (US$63.3 billion) to be returned to LBIE’s creditors, including near £23 billion for trust claimants and about £16 billion for up to 3,400 unsecured creditors.

Two dividends worth a combined 68.5 percent of claims have already been paid to unsecured creditors and another dividend in November should take the tally toward 100 percent, Lomas said.

LBIE has had about 500 staff working on the wind-down, complemented by 200 PwC staff, all under Lomas in a Canary Wharf tower that is within sight of the former Lehman European headquarters. More than 350 staff are former Lehman employees.

Lomas, 56, who has previously worked on the bankruptcies of MG Rover and the European arm of Enron, said LBIE was likely to keep him busy until he retires in four years.

“It’s 20 times as complex and big as Enron. It’s unparalleled,” he said.

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