18.7.2011
By Simon Miller
Man Group is bidding to end uncertainty at its GLG Funds which are still owed money from the collapsed Lehmans Brothers.
This morning Man Group announced that it would pay $355m (£220m) for the funds' exposure to money still tied up in the Lehmans Brothers estate.
GLG Partners,was bought by Man Group in 2010 and mainly held the exposure through its European Long Short and North American Opportunity strategies. Around 30 GLG funds with a collective $2.8bn in assets had exposure to Lehman.
Man Group will buy the residual exposure at its current net asset value, using some of the $900m net cash on its balance sheet. The net effect of the transaction on its regulatory capital will be around $50m according to the firm.
The move aims to help Man Group market the GLG Funds to new investors with a possible windfall if Lehman's payouts come to more than the $355m investment.
Peter Clarke, chief executive of Man, said: "These transactions will remove the remaining uncertainty from funds with residual claims against the Lehman estates, to the benefit of both existing and new investors. In this way, Man can use its resources productively to provide clarity for fund investors and the opportunity to grow assets in the affected funds more quickly."
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