Court terminates and extends administrations of various Lehman Brothers companies

The Court has made an order terminating the administration of Lehman Brothers International (Europe) so that it could be placed into members’ voluntary liquidation, and has extended the term of the administration of three other Lehman Brothers companies.

The administrators of four Lehman Brothers companies applied for their term of office to be extended for three companies and for Lehman Brothers International (Europe) (LBIE), for their appointment to be terminated and replaced by a members’ voluntary liquidation (MVL).

LBIE entered administration in 2008 following Lehman’s collapse. Its administration had been highly successful, recovering £27.8 billion and paying all creditors in full with statutory interest. The Court held that whilst usual, creditors’ voluntary liquidation or dissolution were not appropriate in the circumstances as LBIE was solvent and there remained matters outstanding which would be cut off. Although MVL is not expressly provided for under Schedule B1, this did not mean it was not an available process. The Court accepted it as an appropriate and cost-effective option, noting that it should be simpler, less unwieldly and cheaper than the alternative of continuing the administration. 

For the other three companies, one- and two-year extensions were granted. The three companies could not yet exit administration, since they had not yet paid their creditors in full and there were various matters which remained to be dealt with by the administrators, including resolving HMRC tax enquiries, managing final distributions, and addressing complex intercompany flows. The Court was satisfied that, despite previous lengthy extensions, the current extensions were necessary and proportionate, noting that notifications were duly made to persons of interest, and no objections arose from stakeholders, including HMRC and the FCA.

Re Lehman Brothers International (Europe) [2025] EWHC 2871 (Ch)