Recovery Plan Proposed for Lernout & Hauspie

A group of investors in Lernout & Hauspie Speech Products, the onetime highflying technology firm now under bankruptcy protection, have developed an alternative recovery plan they say will benefit shareholders.

The company already has filed its recovery plan with a Belgian court--which involves selling the speech and language technology or forming a new company from those assets.

The shareholders’ plan will let the company avoid liquidation and offers creditors certainty about the amounts they will eventually receive, said Roger Van Praet, chairman of the shareholders group.

L&H;, headquartered in Belgium with U.S. headquarters in Burlington, Mass., collapsed after its stock lost roughly $10 billion in value in one year.

Former L&H; Chief Executive Gaston Bastiaens, 54, was arrested on fraud charges Saturday near his Winchester, Mass., home and is expected to be arraigned today in U.S. District Court in Boston.