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After seeing debt concerns take down Bear Stearns Cos. and Carlyle Capital Corp., some of their peers aren't taking chances when it comes to their balance sheets.
Lehman Brothers Inc., considered by some as the most likely to follow in
Bear Stearns footsteps, is planning to raise $3 billion
from a share sale. The new capital will shore up Lehman's balance sheet
after concerns about its financial health and exposure to
mortgage-backed securities battering the stock this year.
Also raising money is KKR Financial Holdings LLC, a real estate investment trust affiliated with the New York private equity giant, that plans an offering of 20 million common shares. The Nasdaq-traded subsidiary saw Carlyle Capital buried by exposure to mortgage-backed assets and has been moving to assure investors that its balance sheet is strong. Related to the offering is KKR Financial's announcement that it sold a controlling interest in itself to Rock Capital 2 LLC and that it came to an agreement with lenders regarding its asset-backed credit facilities. KKR Financial's lenders will receive collateral from two asset-backed facilities in exchange for terminating the outstanding commercial paper without a default. The deal removes $3.5 billion in commercial paper and related residential mortgage-backed securities from KKR Financial's balance sheet. - George White See Deal.com story on Lehman Brothers See KKR Financial press release See Dealscape post on Lehman's history See Dealscape post on KKR's new fund Categories Deal Video
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