* Value of claims traded in September doubled from August
* Sept bankruptcies, by assets, highest since Nov 2009
Oct 19 The face value of U.S. bankruptcy claims
traded in September was the highest since July 2010, according
to a report released on Wednesday.
The value of claims traded in September doubled from August
to $4.52 billion, according to SecondMarket, which runs a
claims trading platform. The number of claims traded in
September rose to 1,264 from 891 in August.
Creditors such as landlords and trucking companies can
trade or sell their claims against bankrupt companies. The
seller gets immediate cash, while the buyer, often a hedge fund
investor, hopes to make a profit by betting on the timing and
ultimate payout in the bankruptcy.
Bankruptcy filings have risen recently as lenders have
pulled the plug on struggling companies such as magazine paper
maker NewPage Corp and solar panel maker Solyndra LLC.
Companies with $4.9 billion in pre-bankruptcy assets filed
for Chapter 11 in September, the most since November 2009,
according to Andrew Gottesman, who heads the bankruptcy claims
market for SecondMarket.
Unlike 2009, when bankruptcy filings cut across all
industries, the latest increase has been specific to a few
hart-hit sectors, he said.
"Sit-down casual restaurants are getting murdered. Airlines
could be next," he said.
Lehman Brothers Holdings Inc , by far the largest
bankruptcy in U.S. history, had the highest number and value of
claims traded in September, as it does every month.
Other active cases included restaurant chain Perkins &
Marie Callender, defunct telecoms equipment maker Nortel
Networks Inc , law firm Heller Ehrman LLP, and
college bookstore owner Nebraska Book Co.
The cases with the highest face value of claims traded
included grocer Great Atlantic & Pacific Tea Co ,
defunct book retailer Borders Group Inc , and
Centaur LLC, which operates horse racing tracks, had one
traded claim with a face value of $28.8 million, which was
enough to rank it No. 2 behind Lehman in value of claims