Lehman Says Cash Ready for Creditors Is About $18 Billion
February 16, 2012, 7:07 PM ESTBy Linda Sandler
(Updates with claims in second paragraph.)
Feb. 16 (Bloomberg) -- Lehman Brothers Holdings Inc., which is planning its first payment to creditors after more than three years in bankruptcy, said it has about $18 billion of cash available for distribution.
The defunct investment bank estimated that allowed claims of general unsecured creditors are about $284 billion. In theory, Lehman said it could distribute $12 billion to $14.7 billion of cash initially, depending on how much it needs to keep in reserve for disputed claims, according to a filing in U.S. Bankruptcy Court in Manhattan yesterday. The cash holdings are based on year-end numbers, it said.
Lehman, whose creditors range from Goldman Sachs Group Inc. to individual bondholders, said the calculations were “illustrative” only. Last month, Lehman said it may initially distribute $8.1 billion to $10.7 billion in a payment planned for this quarter.
To boost the payment to the higher end of the range, Lehman has asked a judge to let it keep non-cash assets as reserves for disputed claims. It is in talks with large claimholders to try to win their agreement for the plan, Lehman told the judge at a court hearing yesterday.
Last month, Lehman said it would make a total of about $56 billion in distributions over the next few years. It put disputed claims at $112 billion.
Previously, Lehman Chief Executive Officer Bryan Marsal has said he intends to raise $65 billion from the firm’s assets in the next few years, giving the average creditor less than 18 cents on the dollar for estimated claims of $370 billion.
Lehman, which in 2008 filed the biggest bankruptcy in U.S. history, has winnowed down claims from 67,000 filed originally demanding about $1.2 trillion from what was once the fourth- largest investment bank. It filed for bankruptcy with $613 billion in debt under former Chairman Richard Fuld.
The case is In re Lehman Brothers Holdings Inc., 08-13555, U.S. Bankruptcy Court, Southern District of New York (Manhattan).
--Editors: Glenn Holdcraft, David E. Rovella
To contact the reporter on this story: Linda Sandler in New York at lsandler@bloomberg.net
To contact the editor responsible for this story: John Pickering at jpickering@bloomberg.net
