PAAM settlement said to be close

From MF Global Ltd’s second quarter result statement this morning:

MF Global Ltd is currently in active discussions to settle litigation against its US operating company, MF Global Inc., brought by the Receiver Ad Litem for Philadelphia Alternative Asset Fund and related entities. As a result of these discussions, the company has recorded a litigation accrual of $69 million in its income statement. The company believes that these settlement and litigation costs are fully insured...

...A definitive settlement agreement is anticipated within the coming weeks. MF Global will obtain full releases and dismissal of the proceedings against it while admitting to no wrongdoing in this matter. Settlement of the case avoids the vagaries of a jury determination and the substantial cost of litigation.

As part of the separation from its former parent, the UK-based Man Group plc, MF Global Ltd was indemnified for costs exceeding $50 million arising from its PAAM involvement.

MF Global Reports Fiscal 2008 Second Quarter Results
Oct. 30 2007