MF Global trustee inks sale deal allowing for final creditor payments

By Kali Hays

New York, July 24 – MF Global Inc. liquidation trustee James W. Giddens is seeking approval from the U.S. Bankruptcy Court for the Southern District of New York of a sale and assumption agreement with MF Global Holdings Ltd. that will allow for a final distribution to general unsecured creditors, according to a news release.

The trustee said that the cumulative effect of the agreement “is the economic equivalent of an immediate injection of at least $186 million into the estate.”

Under the proposed agreement, Giddens will sell some claims, estate assets, contracts, documents and data to MF Global in exchange for the buyer forgoing further distributions on its general unsecured creditor claims, which total more than $1.16 billion.

All remaining estate cash available after the final distribution to MF Global creditors will be included in the sold assets, according to the release.

The final payment will bring the total distribution to general unsecured creditors to 94% to 95%, and Giddens said that the agreement “marks a final chapter in the liquidation and is the best possible outcome for the estate.”

MF Global was a New York-based commodity and derivatives broker that filed for bankruptcy on Oct. 31, 2011 under the Chapter 11 case number 11-15059.

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