MF Global Inc. Trustee Receives Court Approval for Final 95% Distribution to Unsecured General Creditors
Sale and Assumption Agreement with MF Global Holdings Approved; Approval Signifies Near End of MFGI Liquidation
James W. Giddens, Trustee for the liquidation of MF Global Inc. (MFGI), today received approval from the Bankruptcy Court, Honorable Judge Martin Glenn presiding, to make a final, cumulative 95% distribution on all non-affiliate, non-subordinated, allowed general unsecured creditor claims. The Trustee and the Plan Administrator of MF Global Holdings Ltd. also received approval for a Sale and Assumption Agreement between the two entities.
“The liquidation of MF Global Inc. is now essentially complete,” Giddens said. “The liquidation’s outcome – with customers and secured creditors completely satisfied and unsecured creditors receiving a near full recovery – was unimaginable when the proceeding began less than four years ago with revelations of a massive segregation failure.”
The Trustee has begun the logistical planning needed to commence the final distribution promptly, and the Trustee expects to start sending out checks immediately after Labor Day.
“Our extensive efforts to recover property, resolve complex claims, and seek approval for innovative motions to allow property to be returned more quickly were overwhelmingly successful,” Giddens continued. “This outcome demonstrates the effectiveness of the Securities Investor Protection Act and the Bankruptcy Courts at handling even unprecedented failures of regulated broker-dealers and commodities firms. I appreciate the understanding of customers and others who were subjected to uncertainty and deprived of their property while novel and difficult issues were negotiated and resolved in the courts following the segregation failure that led to MFGI’s collapse.”
After the final unsecured creditors distribution is complete, the Trustee will have distributed over $8.1 billion to MFGI customers and creditors, including approximately:
· Customer claimants - $6.9 billion to cover 100 percent of allowed claims
· Secured, administrative and priority general claimants - $35 million to cover 100 percent of allowed claims
· Non-Affiliate unsecured general claimants - $219 million to cover 95 percent of allowed claims
· Affiliate unsecured general claimants - $905 million on their allowed nonsubordinated unsecured claims
These remarkable and unexpected results were achieved only with cooperation and assistance by the Securities Investor Protection Corporation, the Commodity Futures Trading Commission, several committees of the Senate and House of Representatives, regulators and other parties.
The results achieved do not diminish the importance of the actual segregations failure that led to MFGI’s collapse. Claims against former officers, directors and other employees of MF Global, including former MF Global CEO Jon Corzine, are ongoing in the Multidistrict Litigation.
Six claims against MFGI remain unresolved, and the Trustee has established a final unsecured claims reserve to account for those claims. After the remaining claims are resolved, the Trustee intends to close the MFGI estate, ending the liquidation proceeding. 2 The information in this statement does not apply to any other MF Global entity, including separate insolvency proceedings involving the parent company, MF Global Holdings Ltd.