The deal requires bankruptcy court and regulatory approvals, but if it goes ahead the London bank would pay $250 million for Lehman assets with a current estimated value of $72 billion and trading liabilities worth an estimated $68 billion. It would pay an additional $1.5 billion for Lehman's Seventh Avenue headquarters and its two data centers, a sum Barclays said is close to their current market value.
The deal comes almost a year after Barclays CEO John Varley lost a bid battle for ABN Amro Bank NV, leaving a rival consortium led by Royal Bank of Scotland Group plc to seal the world's biggest ever financial services takeover.
The agreement covers Lehman's North American fixed income and equities sales, trading and research, and investment banking operations, and it would put Barclays' in the top three in U.S. capital markets, realizing president Bob Diamond long-held ambition to build a serious player on Wall Street.
The Barclays deal does not include Lehman's investment management division, which includes fund manager Neuberger Berman and Lehman Brothers Asset Management. As of Tuesday, Lehman was in advanced discussions with at least five private equity firms, including Clayton, Dubilier & Rice Inc., Bain Capital LLC and Hellman & Friedman LLC, and reports have suggested a deal could be announced within a few days. -
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