The thousands of MF Global customers whose lives and businesses were derailed after $1.6 billion vanished in the collapse of the brokerage firm have now received offers to sell their claims and recoup nearly the entire shortfall, people involved in the negotiations said.
What was once thought to be a lost cause has erupted into a bidding war among Wall Street firms: Barclays , the Royal Bank of Scotland and the Seaport Group, a little-known firm that specializes in distressed assets, are all scrambling to buy MF Global customer claims.
On Monday, Barclays Capital, the investment banking unit of the London-based bank, agreed to purchase most claims for 90 percent of face value, the people said. R.B.S has said that it will pay 91 percent for the claims of institutions (but not individuals), according to a term sheet.
The possible turn in fortunes for MF Global customers began with a bid from Barclays that followed six weeks of negotiations between the bank and the coalition of customers. Its bid represented a belief that Wall Street investors have an appetite for claims, which customers filed last month with a court-appointed trustee. Other suitors soon followed Barclays.Page 1 of 5 | Next Page