Court approves Lehman units sale
Investment bank Lehman Brothers has gained court approval to begin the sale of key North American units to Barclays, as its negotiators neared a deal to sell other parts of the business, starting with its prized money management business.
Lehman secured a judge's backing to proceed with selling its investment banking and trading operations, which British banking giant Barclays has agreed to buy. Judge James Peck is expected to consider final approval of that deal on Friday.
Lehman, which filed the biggest bankruptcy in US history on Monday, is trying to unload its assets and potentially save thousands of jobs. A person familiar with the negotiations said Lehman was close to announcing a deal for the investment management division that includes its Neuberger Berman money management unit.
Private equity firms Hellman & Friedman and Kohlberg Kravis Roberts are among the bidders, the person said. A deal could be announced within the next few days, he said.
Neuberger Berman was once valued as high as £5.6bn by Wall Street analysts, but now could fetch much less considering Lehman's bankruptcy filing.
Meanwhile, Lehman is also trying to sell global operations not covered under the Barclays deal, or others to go along with the investment management division.
In court, Lehman got a bankruptcy judge's initial approval of the sale of assets including its North American investment banking and trading operations, its Manhattan office tower and two New Jersey data centres to Barclays for £940 million in cash.
The judge's approval sets in motion the asset sales but leaves open the possibility of a competing bid before Friday's hearing.
Lehman lawyers said the investment bank needed to close the deal quickly to preserve the remaining value of its assets. The agreement with Barclays calls for the deal to close within a week, on or before September 23.
Judge Peck agreed that moving forward quickly was important in light of the financial stability that has reshaped Wall Street and created economic uncertainty in markets around the world.
