Dentons racks up £20m on Federal-Mogul workout
Legal Week reports
October 04, 2006 at 08:03 PM
2 minute read
Denton Wilde Sapte is to collect more than £20m in fees on the mammoth restructuring of Federal-Mogul, Legal Week has learned, in a significant boost for the City firm.
Dentons' highly-rated insolvency team, which has been acting for UK administrators Kroll on the restruc-turing of the manufacturing company for five years, has already billed £20m and is still working on the process.
Head of insolvency Mark Andrews, who led the Dentons team, which did number more than 50 lawyers, said: "These figures cover our entire cost; the whole restructuring, including battles fought with insurers, pension funds and US asbestos claimants."
The sum is comparable with the controversial fees charged by magic circle giants Clifford Chance (CC) and Allen & Overy (A&O) on their respective restructuring roles for British Energy and Marconi. CC charged £25.7m on the British Energy restructuring, which ended in 2004, while A&O netted fees of about £25m on the restructuring of telecoms company Marconi in 2003.
The legal fees for Federal-Mogul are in addition to a further £10m in professional adviser fees and £40m of fees charged by administrator Kroll.
Ian McFall, head of asbestos litigation at Thompsons, which was representing asbestos victims attempting to secure compensation in the process, said: "For those families who have suffered, it will be hard to accept that they [may] get only 20% [of what their claim was worth] while the administrators and their lawyers will be paid their bill of £70m in full."
Federal-Mogul, one of the world's biggest manufacturers of auto parts, had several US subsidiaries. In all, 134 UK subsidiaries filed for Chapter 11 protection in the US on 1 October, 2001. The UK companies went into administration in the UK simultaneously.
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