NEW YORK, Dec 3 (Reuters) - Archstone, a real estate company partly owned by Lehman Brothers Holdings Inc, and two of Lehman's bank units completed financial restructurings this week, the companies said on Friday.
Archstone swapped more than $5.4 billion in debt for equity and extended all near-term debt maturities, clearing the way for acquisitions and development, the real estate investment company said on Friday.
In addition, Lehman said it transferred cash and other items to its Aurora Bank and Woodlands Commercial Bank units, enabling the banks to keep going as Lehman prepares to sell or shut them down as part of its efforts to raise cash for creditors.
Lehman said it transferred about $535 million in cash and $336 million in mortgage loans, a corporate loan and mortgage servicing rights to Aurora. It said it plans to sell the bank in 2012.
Lehman also transferred $75 million in cash and $200 million in other noncash consideration to Woodlands, it said. It plans to sell or shut down the bank in 2012.
Regulators have limited the businesses of both banks because of capital requirements.
ARCHSTONE REDUCES DEBT
Archstone, which said it had ownership stakes in 441 apartment communities in the United States and Europe as of Sept. 30, said the finance deal cleared up 'legacy financial issues.'
Archstone has been saddled with debt since Lehman did a $22.2 billion takeover of the company in 2007. Lehman now owns 47 percent of Archstone. Barclays Plc and Bank of America Corp own another 47 percent.
Lehman's takeover of Archstone added hundreds of prime apartment buildings nationwide to the investment bank's portfolio.
The move saddled Lehman with more debt just as the U.S. property market was in the early stages of a decline. Lehman filed for bankruptcy on Sept. 15, 2008, and is trying to sell assets to pay creditors.
A bankruptcy court judge gave Lehman permission to do the Archstone debt restructuring and Aurora and Woodland cash transfers. Lehman said the Archstone deal would allow Archstone to reduce interest payments and give it more time to pay off debts.
The case is In re: Lehman Brothers Holdings Inc et al, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555.
(Reporting by Caroline Humer; Editing by Lisa Von Ahn, Phil Berlowitz) Keywords: ARCHSTONE/ (caroline.humer@thomsonreuters.com; Tel: 1-646-223-6181) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
Archstone swapped more than $5.4 billion in debt for equity and extended all near-term debt maturities, clearing the way for acquisitions and development, the real estate investment company said on Friday.
In addition, Lehman said it transferred cash and other items to its Aurora Bank and Woodlands Commercial Bank units, enabling the banks to keep going as Lehman prepares to sell or shut them down as part of its efforts to raise cash for creditors.
Lehman said it transferred about $535 million in cash and $336 million in mortgage loans, a corporate loan and mortgage servicing rights to Aurora. It said it plans to sell the bank in 2012.
Lehman also transferred $75 million in cash and $200 million in other noncash consideration to Woodlands, it said. It plans to sell or shut down the bank in 2012.
Regulators have limited the businesses of both banks because of capital requirements.
ARCHSTONE REDUCES DEBT
Archstone, which said it had ownership stakes in 441 apartment communities in the United States and Europe as of Sept. 30, said the finance deal cleared up 'legacy financial issues.'
Archstone has been saddled with debt since Lehman did a $22.2 billion takeover of the company in 2007. Lehman now owns 47 percent of Archstone. Barclays Plc and Bank of America Corp own another 47 percent.
Lehman's takeover of Archstone added hundreds of prime apartment buildings nationwide to the investment bank's portfolio.
The move saddled Lehman with more debt just as the U.S. property market was in the early stages of a decline. Lehman filed for bankruptcy on Sept. 15, 2008, and is trying to sell assets to pay creditors.
A bankruptcy court judge gave Lehman permission to do the Archstone debt restructuring and Aurora and Woodland cash transfers. Lehman said the Archstone deal would allow Archstone to reduce interest payments and give it more time to pay off debts.
The case is In re: Lehman Brothers Holdings Inc et al, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555.
(Reporting by Caroline Humer; Editing by Lisa Von Ahn, Phil Berlowitz) Keywords: ARCHSTONE/ (caroline.humer@thomsonreuters.com; Tel: 1-646-223-6181) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
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