Lehman Brothers to Announce Takeover/Buyout

9-10-08  Lehman Losses Double Expectations – No Deal in Sight

9-9-08 11:40 pm PST 

Private Equity Firms Interested in Buying Lehman: This is in line with what my source says is going down at Lehman.  This is confirmation of the story I originally broke on Sunday 9-7-08 – Nice of everyone else to catch up with me.  Read On:  

 In recent weeks, Lehman Brothers has received interest from private equity firms for a potential purchase of the troubled brokerage house, but top officials said the company wasn’t for sale, people close to the matter say.

The news comes as Lehman prepares to preannounce third-quarter results at 7:30 am Wednesday morning in New York. Lehman will also provide investors with some guidance on the firm’s “strategy”.

Lehman is expected to announce a massive loss, and writedowns from troubled debt. The firm has been hammered in recent days as it attempts to raise capital through infusions from banks, and the sale of its investment management business.

Some big investors are praying for an outright sale of the firm, whether its private equity or a large U.S. bank, like Bank of America.

It is unclear just how much private equity firms are willing to pay for Lehman, or whether Lehman brushed aside the interest because the private equity firms made a low ball offers; Sources say senior executives at Lehman told the firm that rather than purchase Lehman, they could bid on its asset management unit.

It is also unclear if regulators will allow a private equity firm to buy a major Wall Street player, particularly one with huge amounts of illiquid securities on its books, like Lehman.

But with the 45 percent drop in the firm’s share price on Tuesday, Lehman may be open to even low ball offers from private equity firms despite the famously independent streak of its CEO Richard Fuld.

Lehman has historical ties with private equity firm Blackstone; the firm’s executives Peter Peterson and Steve Schwartzman were former Lehman investment bankers.

A spokesman for Lehman declined to comment.

5:40 pm PST  Lawsuit Filed to Block Fannie Freddie Bailout

Fannie Mae faces investor lawsuit – Reuters

 

 

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Analyst Dick Bove  of Landenburg Thalmann is now upping his estimate of Lehman Q3-08 losses to be closer to $7BB, rather than the $5BB that has been discussed widely in the press.

On a live phone interview at 2:07 pm PST, Bove says Fed and heads of major banks are meeting now over the Lehman crisis hoping to create a unified voice on the matter to soothe markets.

Bove predicts if no intervention is employed that Merrill, WAMU, AIG and others will be threatened with short-sale pressures that could culminate in their collapse.

Shares of Lehman were up 3%+ in after the bell trading at the time of this posting after Goldman Sachs announced that there had been no halt to trading of Lehman shares.

Faux analysts are split 3-1 in favor of Lehman’s continued viability, especially given the support expressed by Goldman Sachs and Citigroup in after-hours trading. 

The dissenting analyst speculated that Lehman had a deal on the table last week but blew it – predicts stock will go to zero.

Time is up for Lehman Brothers – Stock Reaches Lowest Level in more than ten years.

Details to follow here at YourMortgageOrYourLife.com. 

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Confidential sources exclusive to YourMortgageOrYourLife.com indicate that Lehman is close to announcing a voluntary takeover / merger.  Private Equity capital will fuel the deal in combination with a publicly traded company that is looking to position itself as an investment banking powerhouse in coming years.

CEO Dick Fuld is expected to stay for the transition, but will leave after the dust settles.  The deal will satisfy Fuld’s and other Lehman top-guns desires to maintain Lehman as one complete entity, including investment management division gem Neuberger Berman.

My Take:  The deal makes more sense than breaking up Lehman and selling offNeuberger, which was only expected to fetch near $6BB, but is valued by some analysts at over $10BB – more than the lion’s share of Lehman’s total Market cap of around $11.5BB.

The deal will also allow Fuld and other current Lehman management and board members to make a more graceful exitand not saddle them with the legacy of having been at the helm of one of the greatest American financial institutions as it was plowed headlong into an iceberg of high-risk subprime mortgage gambles during the recent housing boom.

Details on this deal are scant, and I will be filling in the rest of the story as it is revealed this week.

Remember – for the best Lehman Brothers analysis – keep checking here at YourMortgageOrYourLife.com where the Lehman Dead Cat Bounce was called last Thursday, the KDB deal was called dead last Friday, the voluntary takeover/merger was announced Sunday, and the first solid news of Lehman’s ultimate fate are being revealed today.

No one else has the line on Lehman.

Hey Guys!  Why Don’t You Give Me a Statement?  anthonymfreed@gmail.com

 

Domain Name Lehman.COM ? (Commercial)

 

IP Address 192.147.58.# (Lehman Brothers)  

ISP Lehman Brothers

Location Continent : North America

Country : United States (Facts)

State : New York

City : New York

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Faux Reports:  Lehman has not accessed the Fed’s Discount window.  KDB is a dead deal.  Sentiment is that there will be no Federal intervention, with unnamed analysts suggesting Lehman is “small enough to fail.”  Faux Reports:  Lehman has not accessed the Fed’s Discount window.  KDB is a dead deal.  Sentiment is that there will be no Federal intervention, with unnamed analysts suggesting Lehman is “small enough to fail.”