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ARTICLE · 18 JULY 2016

Innovative Cut-Off Scheme Accelerates Lehman Liquidation

Mayer Brown
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Did you know that a scheme of arrangement can be used to reduce the creditor constituency in a liquidation, so that time and costs can be saved for the benefit of all parties?

Hong KongInsolvency/Bankruptcy/Re-Structuring
Thomas Pugh
Thomas Pugh
Edmund Ma
Edmund Ma
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Did you know that a scheme of arrangement can be used to reduce the creditor constituency in a liquidation, so that time and costs can be saved for the benefit of all parties?

The Honourable Mr. Justice Ng of the Hong Kong High Court made an Order sanctioning a scheme of arrangement (Scheme) proposed by the Joint and Several Liquidators (Liquidators) of Lehman Brothers Asia Holdings Limited (LBAH) to be implemented between LBAH and certain of its unsecured creditors (Scheme Creditors).

LBAH is one of the Hong Kong-incorporated subsidiaries in the Lehman Brothers group, of which the ultimate holding company is Lehman Brothers Holdings Inc (LBHI). LBHI and certain affiliates controlled by it (together, LBHI and Affiliates) collectively hold most of the unsecured claims admitted in the LBAH liquidation. Of the balance of the admitted claims (Scheme Claims), a large part is held by other members of the Lehman Brothers group, and the rest by third parties. These latter

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