Eldon Street Holdings Limited (in administration)

This site provides information regarding the progress of the administration of Eldon Street Holdings Limited (“Eldon Street”).

Eldon Street entered administration on 9 December 2008. The current Joint Administrators are Gillian Eleanor Bruce, Edward John Macnamara and David James Kelly. The Joint Administrators manage Eldon Street's affairs, business and property as agents without personal liability. All the Joint Administrators (the “Administrators”) are licensed in the United Kingdom to act as insolvency practitioners by the Institute of Chartered Accountants in England and Wales.

Information

Timeline

In 2008, Eldon Street Holdings Limited ("Eldon Street" or the "Company") entered administration, with the objective of achieving a better result for its creditors than in a liquidation.
The Company was a holding company for various real estate investments, mainly through intercompany receivables and direct equity in subsidiaries.

In 2009, the Administrators reported that they had realised £343,442 from assets held on trust and made payments of £442 for statutory costs.
They also obtained creditors' approval for their remuneration to be fixed by reference to the time spent by them and their staff.
No Creditors' Committee was formed as only one nomination was received.

Administrators received dividends from a subsidiary, recovered an intercompany loan, and sold tax losses, resulting in total receipts of £885,512. They also made payments of £413,070, mainly for professional fees, payments on behalf of subsidiaries, and VAT.
The Pensions Regulator listed Eldon Street as one of the Lehman companies from which it was seeking a Financial Support Direction ("FSD") in relation to the Lehman Brothers Pension Scheme, creating uncertainty for the dividend prospects.

Administrators entered into a settlement agreement with Lehman Brothers Holdings Inc ("LBHI") and certain other affiliates, pursuant to which Eldon Street had claims against LBHI agreed at $661.35m and $28.56m for its direct and guarantee claims, respectively.
The Administrators also received corporation tax refunds, tax function cost recharges, and funds held on trust, totalling £1,481,463 in receipts.
They made payments of £1,053,793, including office holder's fees, insurance, and payments on behalf of subsidiaries. The Determinations Panel of the Pensions Regulator decided that an FSD should not be issued against Eldon Street, but the decision was referred to the Upper Tribunal by the Scheme Trustees.

Administrators received a dividend of $29.81m from LBHI and £234k from another subsidiary, as well as interest and tax function cost recharges, amounting to £1,266,500 in receipts.
They made payments of £1,087,412, including a payment of £11.8m into a joint reserve for the potential FSD liability, office holder's fees, and payments on behalf of subsidiaries.
The Upper Tribunal rejected the strike-out application brought by Eldon Street and other entities against the FSD referral, and the Administrators sought permission to appeal to the Court of Appeal.

Administrators received another dividend of $25.1m from LBHI and declared and paid a first interim dividend of 12p in the £ to unsecured non-preferential creditors, totalling £54.41m in payments.
They also received tax refunds, recharges, and interest, resulting in £1,481,463 in receipts. The Court of Appeal dismissed the appeal against the FSD referral, and the Administrators applied for an extension of the Administration to 30 November 2015.

Administrators of Eldon Street Holdings Limited (the "Company") settled the pension matter with the Pension Scheme Trustees and the Pensions Regulator, removing the risk of a Financial Support Direction (FSD) liability for the Company.
They also paid the first interim dividend of 6.94 pence in the pound to the Company's unsecured creditors, totalling £31.8 million.

Administrators paid two more interim dividends of 5.98 pence and 6.65 pence in the pound, respectively, bringing the cumulative dividend to 19.57 pence in the pound and the total distribution to £89.4 million.
They also placed five of the Company's solvent subsidiaries into Members' Voluntary Liquidation (MVL) to release funds for the benefit of the Company's creditors.

Administrators paid the fourth and fifth interim dividends of 6.23 pence and 1.65 pence in the pound, respectively, bringing the cumulative dividend to 27.45 pence in the pound and the total distribution to £125.4 million.
They also received dividends from Lehman Brothers Holdings Inc. (LBHI) and the Company's solvent subsidiaries totalling £25.5 million and £3.1 million, respectively.

Administrators paid the sixth and seventh interim dividends of 3.98 pence and 8.27 pence in the pound, respectively, bringing the cumulative dividend to 39.7 pence in the pound and the total distribution to £181.2 million.
They also received dividends from LBHI and the Company's solvent subsidiaries totalling £10.9 million and £3.1 million, respectively.

Administrators paid the eighth and ninth interim dividends of 2.24 pence and 4.76 pence in the pound, respectively, bringing the cumulative dividend to 46.72 pence in the pound and the total distribution to £213.6 million.
They also received dividends from LBHI and the Company's solvent subsidiaries totalling £22.8 million and £31.5 thousand, respectively

Administrators received a fifth distribution from LBH of £4.7m, including a share of statutory interest entitlement, and sold creditor claims for £1.1m.
They also prepared and circulated their 21st progress report to creditors, and dealt with various tax and VAT compliance matters.

Administrators received a final distribution from Storm Funding Ltd of £92,093, and sold tax losses for £2.9m.
They also prepared and circulated their 22nd and 23rd progress reports to creditors, and applied to the Court for a further extension of the Administration to 30 November 2022.

In 2021, the Administrators paid an 11th interim distribution to creditors of £2.1m, and received a payment of £1.7m from LBH towards their statutory interest entitlement.
They also prepared and circulated their 24th and 25th progress reports to creditors, and applied to the Court to replace certain of the Joint Administrators.

In 2022, the Administrators received a final distribution from Cube and Raven of £123,054, and sold tax losses for £60,481

Administrators of Eldon Street Holdings Limited (ESH) received an eighth interim distribution of £3.8 million from Lehman Brothers Holdings Plc (LBH), which was the minimum remaining amount of post-administration statutory interest that LBH considered to be due to ESH.
However, the Administrators also faced a legal challenge from Lehman Brothers Holdings Inc. (LBHI) in the US Bankruptcy Court, seeking to reclaim $10.2 million that LBHI had paid to ESH under a guarantee claim, plus interest. The outcome of this litigation was uncertain and could affect the timing and quantum of further recoveries from LBH and LBHI.
However, the Administrators also faced a legal challenge from Lehman Brothers Holdings Inc. (LBHI) in the US Bankruptcy Court, seeking to reclaim $10.2 million that LBHI had paid to ESH under a guarantee claim, plus interest. The outcome of this litigation was uncertain and could affect the timing and quantum of further recoveries from LBH and LBHI.

Contacts

If you have any queries in relation to Eldon Street's administration, please send an email to uk_lehmanaffiliates@pwc.com.

_{Edward John Macnamara, Gillian Eleanor Bruce and David James Kelly are licensed in the United Kingdom to act as insolvency practitioners by the Institute of Chartered Accountants in England and Wales. The Joint Administrators are bound by the Insolvency Code of Ethics which can be found at: https://www.gov.uk/government/publications/insolvency-practitioner-code-of-ethics}

^{The Joint Administrators may act as controllers of personal data, as defined by the UK data protection law, depending upon the specific processing activities undertaken. PricewaterhouseCoopers LLP may act as a processor on the instructions of the Joint Administrators. Personal data will be kept secure and processed only for matters relating to the Joint Administrators' appointment. Further details are available in the privacy statement on the PwC.co.uk website or by contacting the Joint Administrators.}