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Lehman sheds asset management operations

FINANCIAL SYSTEM IN CRISIS

September 30, 2008|From the Associated Press

NEW YORK — Lehman Bros. Holdings Inc. on Monday agreed to sell its investment management business to a pair of private-equity firms, fetching $2.15 billion as the bankrupt investment bank continues its liquidation.

Bain Capital Partners and Hellman & Friedman, two of the nation's biggest buyout firms, will take over Lehman's operations in fixed-income and alternative asset management. The deal includes money management firm Neuberger Berman, a 69-year-old name on Wall Street that manages more than $130 billion of investments.

Lehman has been scrambling to sell off healthy portions of the investment bank, whose bankruptcy filing Sept. 15 was the biggest in U.S. history. The investment house sold its key North American businesses, including its investment banking unit, to Britain's Barclays for $1.7 billion in cash. Nomura, Japan's largest brokerage, bought Lehman's operations in Europe, the Middle East and Asia.

The purchase of Neuberger Berman and Lehman's other investment management businesses marks the last major unit to be sold off.

Lehman bought Neuberger in 2003 for $3.2 billion to expand its reach in wealth management. The entire investment management unit was valued at as much as $10 billion before the bankruptcy.

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