Maxwell funds get 27m pounds boost: Lehman Brothers' return of assets follows Bank of America deal

THE Maxwell pension funds, which lost more than pounds 400m when they were raided before Robert Maxwell's death, gained their second boost in a week when Lehman Brothers, the US investment bank, agreed to hand back pounds 27m of the funds' shares.

The news follows the deal last week in which Bank of America paid pounds 25m to the trustees of the Mirror Group Newspapers pension fund to settle a dispute over the Californian bank's role as a custodian of the funds' assets.

A legal action by the MGN fund claiming pounds 200m from Lehman and two other City firms, Invesco and Capel Cure Myers, is due to be heard in the High Court in two weeks' time. The MGN fund is also pursuing a claim for pounds 38m against Credit Suisse, which it claims was jointly liable with Bank of America.

Lehman voluntarily gave back the assets - which comprise shares in publishing group The Telegraph and units in the Lazard Property Unit Trust - after receiving a claim from Neil Cooper of Robson Rhodes, the liquidator of Bishopsgate Investment Management, a fund manager owned by the Maxwell family.

They comprise only part of the assets taken from the Common Investment Fund, the central pool of Maxwell pension fund assets managed by BIM, and used as collateral for loans from Lehman.

Margaret Cole of lawyers Stephenson Harwood, which is acting for the liquidator of BIM, said Robson Rhodes would press ahead with a claim for another pounds 70m of assets held by Lehman as well as pounds 33m of shares in the French group Euris which are held by Banque Nationale de Paris. A third legal action, to recover pounds 58m of assets from Credit Suisse, is expected soon.

Lehman said the difference between the pounds 27m it returned and the pounds 70m, which it is strenuously defending, is that the former sum was not covered by any stock-lending agreement between BIM and the Maxwell private companies.

The investment bank's argument over the other pounds 70m is that it accepted the shares in good faith and had no reason to believe that the Maxwell private companies had no right to use the shares as collateral for loans.

Lehman also, along with two Swiss banks, accepted dollars 137m worth of shares in Berlitz, the US-listed language-learning group, as collateral for shares. These shares were owned by Macmillan, the US arm of Maxwell Communication Corporation, but Macmillan's claim to have them returned was rejected by a London court last month.

The Telegraph and Lazard Trust shares, however, were handed to Lehman in October 1991, the month before Robert Maxwell died, when Lehman was pressing the Maxwell private companies to reduce their borrowings.

Lehman was told it could sell the shares to reduce the loans but did not, instead holding them in an account separate from the other Maxwell assets.

BIM issued a writ last September against Lehman claiming back the assets. By November, Lehman had admitted that it had no claim over the shares. The liquidators of BIM, however, may now pursue Lehman for costs and any diminution of value of the assets while Lehman held them.

The return of the assets means that Robson Rhodes has recovered pounds 320m of the pounds 720m originally in the Common Investment Fund. Mr Cooper reckons that pounds 300m is needed to pay all pensioners. He said he was reasonably confident that he would recover that amount.