May be not, New situation is emrging. Ap is reporting
Report: Refco Weighing Acquisition Offers
Sunday October 16, 9:38 pm ET
Refco, Whose Capital Markets Unit May File for Bankruptcy, Reportedly Weighs Offers for Company
NEW YORK (AP) -- Several bidders emerged as potential buyers for all or parts of Refco Inc. as the commodities-brokerage firm considered placing its unregulated businesses into bankruptcy, The Wall Street Journal reported on its Web site Sunday, citing people familiar with the matter.
The situation remained fluid Sunday evening, with a consortium led by hedge fund J.C. Flowers and other investors each negotiating a possible acquisition for part or all of Refco that could avert or slow a bankruptcy filing by Refco's unregulated Capital Markets unit.
Last week, Refco froze activity at its Capital Markets unit as questions emerged about debts associated with the firm's CEO, Phillip Bennett. Bennett was placed on indefinite leave and charged last week with fraud by federal authorities.
Also over the weekend, Refco hired investment bank Greenhill & Co. to advise it on its options, putting that boutique investment bank to work alongside Goldman Sachs Group Inc.
Greenhill's hiring came as the J.C. Flowers group emerged as the leading suitor for Refco. J.C. Flowers is led by J. Christopher Flowers, a former Goldman partner.
Having Greenhill involved could allay some concerns on Wall Street about Goldman's role as an underwriter in Refco's initial public offering of stock in August, its role as adviser to the embattled firm and the possible sale of Refco to a firm run by an ex-Goldman partner.
Goldman disputes the claims of conflict and says it is advising Refco "pro bono."
The Capital Markets unit trades customized derivatives with a wide range of customers, including Wall Street securities firms, banks and hedge funds. It is largely unregulated. |
