Opes Prime settlement talks have fallen in a heap and the word is that Merrill Lynch was the hold-out. Merrill and ANZ have $1 billion secured against Opes - and subject to legal challenge by the hopping mad Opes faithful.
"Merrill refused to put a cent in" was how one source familiar with the negotiations put it.
"ANZ was prepared to put in what was left in the pool plus damages".
Merrill - which is believed to have been hit up for $80 million by administrator John Lindholm ($400 million from ANZ) - is said to have been reluctant to tip in, arguing that this was ANZ's mess as the big bank had pulled the plug first. Merrill had merely excercised its rights under the AMSLA stock lending contract with Opes and flogged its stock on the market.
This is outright guesswork but Lindholm is believed to be willing to do at deal at around 70c in the dollar and ANZ is thought to have informally discussed a number of 60 cents some time ago.
There are many other considerations such as protection from litigation and so forth but Opes unsecured creditors would be doing well to get 60 cents as most of them would have blown up horribly by now had ANZ not pulled the pin - overgeared on racy stocks as most of them were.
It's not a tough call to say that, on average, ANZ would have done them a favour by taking them out of the stockmarket game, then giving them back 60 cents. That is, of course, unfair for some who were not big risky traders.
mwest@fairfax.com.au
