WaMu Nears Ch. 11 Exit With Shareholder Deal

Law360, Wilmington (May 24, 2011, 3:33 PM EDT) -- Washington Mutual Inc. has reached a tentative settlement with creditors that would hand shareholders a stake in the reinsurance business slated to rise from the ashes of the biggest bank failure in U.S. history, a company attorney said Tuesday in Delaware.

Common equity in the successor reinsurance business would go to shareholders, while other lower-tier creditors would get $160 million of value in two issues of securities: one of preferred shares and another of “debt-like instruments,” Washington Mutual attorney Brian Rosen said at a hearing. The...
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