(Reuters) – Lehman Brothers Holdings Inc will ask a bankruptcy judge on Tuesday
to let creditors vote on its $65 billion payout plan, a key step toward ending
the biggest bankruptcy in U.S. history.
The investment bank, under Chapter 11 bankruptcy protection since September
2008, will present its plan outline at a hearing in U.S. Bankruptcy Court in
Manhattan. If Judge James Peck deems the outline sufficient, creditors will vote
on the plan on November 4.
The plan would pay creditors an average of 20 cents on the dollar, with some
groups receiving more, including derivatives creditors who would take home
nearly 28 cents on the dollar.
Depending on whether creditors accept the plan, final court approval could
come as early as December, providing a glimmer of light at the end of Lehman’s
three-year bankruptcy tunnel.
But hurdles remain before the company can officially exit bankruptcy and
complete its liquidation. Lehman must meet certain financing and other
conditions outlined in its plan, a process that could take days, weeks or
months, a company spokeswoman said last week. Lehman has said it hopes to begin
creditor payouts in the first quarter of 2012.
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