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RTT News – Tuesday, Babcock & Brown Infrastructure Limited said it received on September 17, a refinancing proposal from Royal Bank of Scotland Group Plc, acting on behalf of an investor group, which comprises mainly international hedge funds.

As revealed earlier in the first week of September, Babcock & Brown said it had an agreement with a potential cornerstone investor and hence the directors of the company are required to assess whether the RBS proposal is superior to the existing recapitalization proposal by the potential cornerstone investor.

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Tags: hedge funds, investor-group, recapitalization proposal

Saudi Gazette – A seven-member investor group including billionaire George Soros and Dell Inc. founder Michael Dell have agreed to purchase failed lender IndyMac Bank, one of the largest casualties of the housing bust, for $13.9 billion.

IndyMac, which specialized in loans made with little down payment or proof of assets, was seized by the government in July after a run on the bank as the US housing market collapsed.

The Federal Deposit Insurance Corp. said Friday that a holding company led by Steven Mnuchin, co-chief executive of private equity firm Dune Capital Management, agreed to buy IndyMac in a deal reached Wednesday.

The investors have formed a partnership, called IMB Management Holdings LP, that includes Dell’s investment firm, MSD Capital.

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Tags: bank one, billionaire, bust, capital-management, casualties, dell inc, dune, federal deposit insurance, federal-deposit-insurance-corp, george soros, holding company, investment-firm, investor-group, michael dell, msd capital, private equity firm, saudi gazette, steven mnuchin, us housing market

West Palm Beach (HedgeCo.net) – Lehman Brothers, Wall Street’s fourth biggest investment bank has filed for bankruptcy, making it the largest and highest-profile casualty of the global credit crisis, with approximately $639 billion in assets.

The bank said the Chapter 11 filing will not include its broker-dealer operations and other units, including Neuberger Berman. Lehman is looking at selling its broker-dealer operations, and is still in advanced discussions with a number of potential buyers of its investment management division.

Investors in recent weeks had grown increasingly jittery about Lehman’s $46 billion of mortgages and asset-backed securities, as well as its credit rating and its ability to raise capital. 

Bankruptcy also represents a bad end to Chief Executive Dick Fuld’s four-decade career at Lehman. Fuld, who piloted the investment bank through prior crises with aplomb, was widely seen as too slow to recognize Lehman’s need to raise capital and shed bad assets.

Lehman listed its biggest unsecured creditors as Citigroup Inc, Bank of New York Mellon Corp, Aozora Bank, and Mizuho Financial Group Inc. Citi and Bank of New York Mellon are trustees for Lehman bonds.

The firm said that as of May 31, it owed about $110.5 billion on account of senior unsecured notes, about $12.6 billion on account of subordinated unsecured notes and about $5 billion on account of junior subordinated notes.

Alex Akesson

Editor for HedgeCo.Net
Email: alex@hedgeco.net

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