It was being reported in the Age yesterday that settlement discussions were afoot in the multi-case litigation on foot in the Victorian Supreme Court concerning the failed margin lending house Primebroker Securites, some of its principals and interested parties, and the ANZ Bank. Prior to its collapse in 2008, Primebroker and ANZ had been counterparties in securities lending arrangements.
On the back of its expensive settlement with Opes Prime’s liquidators in early 2009, ANZ was facing another unenviable and expensive legal battle, fighting on several fronts. The Chimaera parties were claiming hundreds of millions of dollars in damages against ANZ on several grounds, including alleging that ANZ had wrongfully reneged on a deal of financial support back in 2008, and that ANZ had acted wrongfully in appointing receivers to Primebroker. The liquidators of Primebroker were also seeking recovery from ANZ of some $200 million in payments it had received from the failing company in the months before its collapse. It was reported by the Age that taken together, ANZ faced total claims in the vicinity of $350 million. (See the full Age article here).
Today, the Age has reported that ANZ has agreed to pay $20.5 million cash to the liquidator of Primebroker Securities. It is reported that as part of the deal, ANZ will release numerous properties owned by the principals of Primebroker, Mr Catalano and Mr Pattison, but which the bank had claimed as security. It is also reported that ANZ will not prove in the liquidation for the estimated $150 million it claims still to have been owed when Primebroker collapsed in July 2008. It is alleged that ANZ will also allow its receivers Paul Kirk and Stephen Longley of PricewaterhouseCoopers to hand the liquidator of Primebroker Laurie Fitzgerald of BDO, their book of Primebroker receivables, which it is said could generate a further $20 million. (See the full Age article here.)