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Lehman Uk Arm To Sue For $100bn

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http://business.timesonline.co.uk/tol/busi...icle6814920.ece

Administrators of the London arm of Lehman Brothers, the Wall Street bank that collapsed a year ago, are preparing a $100 billion (£61.5 billion) claim against its former parent company in America.

The demand, which is being finalised by Price Waterhouse Coopers (PWC), Lehman’s UK administrator, will be lodged in the next few weeks. It will mark an acrimonious new stage in the international battles by creditors to recover billions still tied up in the largest corporate collapse in history.

Lehman owed $613 billion when it imploded last September. Liquidators in New York have since been sorting through the wreckage to set up a system to repay creditors and collect money from debtors. The US bankruptcy court has set a September 22 deadline for all creditors to file their claims.

John Suckow, president of Lehman Brothers Holdings — the remains of the US parent company — and a managing director at liquidator Alvarez & Marsal, is braced for a deluge of claims. The one from the London arm, which was the largest operation outside America, is likely to be the biggest.

Tony Lomas, one of the partners at PWC leading the case, said he will file on behalf of “more than 100†Lehman units that fall under the London umbrella. “On the face of it guaranteed most of the obligations of other subsidiaries so we’re going to be filing claims in the many tens of billions. It will be close to $100 billion,†he said.

The London claim will add to tensions between American and British administrators. Earlier this month, Alvarez & Marsal brokered an agreement with 13 other Lehman liquidators around the world.

The deal sets a protocol to share information on claims and assets with the hope of speeding up the reconciliation process and avoiding litigation. PWC declined to participate.

“Why you’d enter into an agreement with a bunch of other parties that you’ll probably end up litigating against is beyond conception,†said Steve Pearson, another PWC partner working on the case.

And what would PWC cut be out of this $100bn??

Although I suppose in cases such as this you make your claim as big as possible?

Lehmans certainly appears to be generating into a good soap.

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