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LONDON — Bingham McCutchen is set to secure a major role in the Northern Rock saga with the U.S. restructuring leader being instructed to advise a group of bondholders on their position. The firm has been approached alongside investment boutique Houlihan Lokey by a number of the mortgage-lenders’ junior bondholders to offer advice on their investments. The bonds have not been guaranteed by the UK government in the wake of the funding crisis that has seen savers remove billions of pounds from Northern Rock, despite Bank of England support for the institution and moves to protect retail deposits. Bingham and Houlihan Lokey are in the process of organizing a conference call for concerned junior lenders. A Bingham partner Thursday told Legal Week that the firm had not yet been formally appointed but added that the firm expected to take on an official role shortly. UK office head James Roome or London finance head Barry Russell would be likely to take on the mandate if instructed. The high-profile mandate would further underline the heavyweight status of Bingham’s bondholder practice both in the U.S. and UK, where the firm has traditionally shared the pick of such instructions with rival Cadwalader Wickersham & Taft. Bingham looks set to join a raft of others cashing in on the beleaguered bank’s troubles. Slaughter and May is advising the Financial Services Authority and the Treasury on the options for the bank, alongside Goldman Sachs. Meanwhile, Freshfields Bruckhaus Deringer co-head of worldwide financial institutions William Lawes and structured finance chief Alan Newton are advising Northern Rock. Freshfields is a regular adviser to the Newcastle-based institution, advising on its acquisition of Legal & General Bank and Legal & General Mortgage Services in 2001. It emerged last week that Northern Rock had received a number of approaches for parts of the bank. Interested parties are thought to include U.S. buy-out house Cerberus, which is understood to be using Ashurst, and fellow fund Citadel, which Allen & Overy has advised in the past. A group of Spanish investors led by entrepreneur Jose Maria Ruiz-Mateos are also thought to be interested. The saga is being closely watched in London after Northern Rock this month fell victim to the ongoing credit crunch, which sent the cost of its fund-raising on the money markets to unsustainable levels, triggering a call for an emergency loan from the Bank of England. The ensuring panic withdrawal of savings is the first bank run to occur at a large UK bank for more than 100 years. Georgina Stanley is a reporter for Legal Week, a Recorder affiliate based in London.

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