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International law firm Weil, Gotshal & Manges is advising MF Global UK Ltd., the UK arm of commodities and listed derivatives broker MF Global, on the very first filing in recent days of the UK’s Special Administration Regime application.
This application comes after the voluntary chapter 11 filings made by its parent company, MF Global Holdings Ltd., a Delaware company listed on the New York Stock Exchange, and MF Global Finance USA Inc., an intermediate holding company.
Adam Plainer is leading Weil’s restructuring team, and he is working with Martin Pascoe QC and Daniel Bayfield of 3-4 South Square. The team applied for an expedited appointment of KPMG partners Michael Pink, Richard Fleming, and Richard Heis as special administrators of MF Global UK. Coinciding with the request, Weil was appointed as legal advisers to the Joint Special Administrators.
The introduction of the Special Administration Regime (SAR) came after the collapse of Lehman Brothers. The SAR provides a framework for dealing with insolvent or failing investment banks. It puts forth as special objectives for the administrators to ensure the return of client assets as soon as practicable; to ensure timely engagement with market infrastructure bodies and the authorities; and either to rescue the firm as a going concern or wind it up in the best interests of the creditors. Until recent days, the SAR had never been initiated.
The Weil team on this UK-sourced instruction is being led by the head of restructuring in the firm’s London office, Adam Plainer, assisted by Mike Francies, Paul Bromfield, Dominic McCahill, Steven Ong, Linton Bloomberg, Will Needham, Jodie Dunlap, Rosy Villar, Helen Jones, David Elphinstone, Lorena Wong, and Lewis Blakey.
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Adam Plainer was quoted as saying in a press release at Weil’s website: “This is a truly groundbreaking case as it is the first time the new Special Administration regime has been used. The Administrators will be working closely with the FSA who have extensive powers under the new legislation.”
Mike Francies was quoted as saying: “From the time of the first meeting with MF Global UK on Friday, morning, Adam and the team have worked round the clock to help MF Global to stabilize this challenging situation in the UK. The ability to work with the Company, KPMG, Counsel and the FSA to initiate the SAR’s first application against the clock and in the current market conditions cannot be underestimated. This is a huge achievement in difficult circumstances.”
MF Global Holdings has been at the forefront of the news in recent weeks, as has CEO Jon Corzine. According to the November 2nd businessweek.com article, “MF Global’s Jon Corzine Runs Out of Luck”, Corzine’s career included nearly a quarter century at Goldman Sachs (GS). Less than two years after his appointment as chairman and chief executive officer, the company is bankrupt.
According to the same article, Wall Street embraced the appointment of Corzine; MF Global shares increased 15 percent the week his hiring was announced. Now, Occupy Wall Street has replaced the hoopla, along with MF Global’s nearly $200 million quarterly loss, and the disclosure of over $6 billion in bets on European government bonds.
