Maiden Lane III auctions within an auction?

*CORRECTION*Got it. They're basically using the Barclays proposed structure (It's joint between BARC, BAML, and NOM nom nom) to form MAXX 2012-MAX to CDO^2 to retranche the risk in the two current MAX A1 tranches for sale. They'll roll up the bids on their "new issue" to make a pass-through bid to the Fed. 

The competing bidding group appears to be Citi/Goldman's Sack/CS, and they are also soliciting bids from their clients that will effectively be passed through as a bid on the two MAX CDO tranches (and passed back in pro rata amounts if they get oversold), but they are not re-securitizing anything.

Both parties are charging a 0.25 mark up  for their strategy.

No one can blow up the original CDOs without consent of the MAX junior bondholders (purportedly DB) or paying off an interest rate swap to Barclays according to this one article.  And both of these strategies seem to put the CDOs far from any near-term scenario that would result in a flood of pure CMBS collateral on the streets.

Let me know if you have any more to add...

Prior post:
What is this MAX deal they're coming out with - it looks like BAML is basically trying issue a new deal to buy the two MAX CDOs from the Fed, structuring it, and charging a flat 0.25bps to investors to give them an opportunity to participate since the bidding list is limited. Is that accurate? I haven't spoken to anyone, just saw the messages flying around.