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Showing posts from 2007

Refco Trustee Brings Suits

Though more than two years old, the Refco bankruptcy still has players fighting over blame and cash. In a lawsuit seeking more than $2 billion in damages and penalties from Refco auditor Grant Thornton LLP (GT), law firm Mayer Brown LLP (MB) and 24 other defendants, Refco Litigation Trustee Marc. S. Kirschner claims that Refco insiders were aided and abetted by a "who's who" list of the world's largest corporate finance, law and accounting firms "to strip out billions of dollars in Refco assets" in a three part scheme to create the illusion of financial health, maintain that illusion and cash-out their interests. In court documents, Kirschner says that MB worked with Refco lawyers to "fraudulently bolster Refco's financial appearance to lenders and investors," through a series of round-trip loans (RTL) that served no purpose but to conceal hundreds of millions of dollars in receivables, a process he likens to a street corner shell game. "I

CBOT Bids Go to the Wire

In the run up to the July 9 shareholder vote on the potential acquisition of the Chicago Board of Trade (CBOT) by the Chicago Mercantile Exchange (CME), the action has been fast and furious, with revised bids from both the CME and the Intercontinental Exchange (ICE) vying for the attention of CBOT shareholders and members. Leadership from the CME and CBOT approved another revision to their definitive merger agreement on June 14, this time incorporating a one-time dividend of $9.14 per share for CBOT shares, and two options for CBOT full members who hold exchange right privileges (ERP) in response to ICE's sweetened bid that came a couple days earlier. The CME also uncapped the amount on legal expenses for the ERPs. These moves follow the May 30 meeting ICE Chairman and CEO Jeff Sprecher had with CBOT shareholders and members, when he pointed out on several occasions that in putting together his competitive bid for the CBOT he attempted to mirror the CME offer in every way but price