PwC returns £11.9bn to Lehmans' creditors

PwC’s Tony Lomas

PwC administrators have returned £11.9bn to creditors during two years in
charge of Lehman Brothers International Europe (LBIE), the biggest corporate
collapse in UK history.

From its appointment on 15 September 2008 to 30 June 2010 PwC has now billed
£257m in fees.

The firm’s
groundbreaking
Claims Resolution Agreement has seen £1.8bn returned to creditors
since March alone, but the firm has been frustrated on other fronts.

High Court judges decided that unsecured creditors could share in a $2bn
(£1.3bn) pot reserved for secured creditors, a ruling which administrators said
had “a material impact for both client money claimants and unsecured creditors
of LBIE, resulting in significant delay to distributions and substantial
additional costs”.

The administrators now need to embark on a complex tracing exercise to
identify any additional claimants and cash or assets which might possibly be
targeted by creditors.

Due to this hurdle, the joint administrators are currently unable to advise
LBIE’s creditors on the timing or amount of an interim dividend.

Given the “overwhelming adverse impact” on the LBIE estate, the
administrators have sought permission to appeal to the Supreme Court on this
issue, PwC said.

More than 480 Lehmans staff and contractors continue to support the
administration team in addition to PwC employees and the administrators’ legal
advisers.

Lehmans joint administrator Tony Lomas said: “Despite these challenges, we
are determined to return trust property and agree creditors’ claims at the
earliest possible opportunity such that once the legal landscape is clearer,
distributions can commence.”

Further reading:

Lehman
Brothers to sue JPMorgan Chase

PwC
seeks $250m Lehman s tax refund

Lehman
s administrators lay down $11bn gauntlet

Lehman
Brothers anniversary timeline