Top Firm Said To Be 'Listening To Offers'
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The jury is still out about whether Lehman could be acquired at this time, given the lack of once-interested buyers who now have their own problems. Citi and UBS's woes are well-documented, and JPMorgan Chase (perhaps the most logical merger partner) has Bear on its hands. Bank of America is a possibility, although CEO Ken Lewis does have the Countrywide deal to bed down, and can't seem to make up his mind at the moment about whether he is enthusiastic having an investment banking division or not.
Barclays remains a contender, although there are concerns about its own capital strength at the moment, and HSBC has the muscle, but not necessarily the commitment (at least not this week) to do a big investment banking deal.
The other big issue on acquiring Lehman is that you might not be certain exactly what you are buying. The executive management shake-up announced Thursday has given rise to concerns that there may be more skeletons to emerge from the Lehman cupboard.
An ironic footnote is that Fuld is also said to be considering offloading a 20 - 30% stake in his firm to Blackstone, the private equity business founded in 1985 by Peter Peterson and Stephen Schwarzman with $400,000 in seed capital. Both Peterson and Schwarzman were former Lehman executives. A deal with Blackstone may give Lehman some breathing space to get its house in order. But Peterson and Schwarzman are unlikely to want to stick around for too long, prompting fears that the firm will eventually have to be sold outright when the market recovers, or raise fresh capital to buy-back any stake Blackstone takes.
