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Taking Stock of Bonds

By Aleksandrs Rozens, IDD Magazine

May 19, 2009

Our Man Millstein

For many in the restructuring world who were disheartened when the U.S. Administration up-ended the basic premise of bankruptcy that secured lenders have priority over unsecureds in the Chrysler case, there may be a glimmer of hope.

Early this week, Treasury brought on a seasoned restructuring professional to serve as the senior restructuring officer. Jim Millstein, a former Lazard restructuring banker and long-time participant in the industry, had his last day of work at the storied investment bank last Friday. This week he works for the U.S. government, which may need a primer on how corporate bankruptcy works.

Millstein joined Lazard as a managing director in its restructuring group nine years ago. He came from the New York office of Cleary, Gottlieb, Steen & Hamilton, where he headed its restructuring practice. 

More recently, at Lazard, Millstein's restructuring assignments included the representation of the United Auto Workers in connection with its negotiations with GM, Delphi, Ford and Chrysler.

Millstein faces a tough challenge. If he, in his new capacity, weighs in on behalf of auto workers in other court supervised restructurings that attract the U.S. government's attention, more than one creditor will ask if he or she truly got a fair deal.

Millstein will have to be, as they say, purer than Ceasar’s wife. That could be tough, as Henry Paulson knows. The former Treasury chief who once was behind the tiller at Goldman Sachs did not bail out Lehman Brothers in the fall of 2008. For some on Wall Street, Paulson will always have a cloud of uncertainty lingering near him even if -– as he says -– his intentions were good.

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Aleksandrs Rozens

Aleksandrs Rozens has 17 years of experience as a financial journalist. He started his career at Dow Jones, and he has worked at Knight Ridder's business news wire where he wrote about mortgage bonds and real estate as well as interest rate swaps. He also edited Private Equity Week and IPO Reporter, and was a reporter for National Mortgage News and helped start the mortgage backed and asset backed coverage at Reuters news agency. Rozens also worked briefly at the AP where he covered real estate, mergers and corporate bankruptcies. Prior to joining IDD he was editor of Bankruptcy Insider. Rozens graduated from Fordham University where he studied English Literature and Russian Studies.

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