Lehman Bros - Who Wants Them?
LONDON (MarketWatch) -- After a drastic slide in Lehman Brothers shares, speculation about clients leaving and a reported search for new strategic options, now would be a good time to acquire the struggling brokerage firm, analysts say. But bidders may be thin on the ground.
"I'm hard pressed to give you many viable buyers of Lehman," said Jeff Harte, a securities industry analyst at Sandler O'Neill & Partners. "Most large banks are focused on their own capital issues."
Even if a bidder did come forward, it would have to win over a lot of Lehman employees -- who control around 30% of the stock -- or risk losing them once the deal was complete, Harte said.
"The employees are not particularly willing to sell, especially at such bargain-basement prices," agreed Stefan-Michael Stalmann, an analyst at Dresdner Kleinwort in Frankfurt.
Shares in Lehman have tumbled more than 80% this year, including sharp falls in recent sessions on speculation that some clients are starting to cut back their business. Those rumors have been denied by the firm and some of its major trading customers.
Lehman is now mulling a handful of options, including a strategic alliance with a partner that it hopes will restore investor confidence, an asset sale, or a possible share buyback, The Wall Street Journal reported on Monday, citing unidentified people familiar with the matter.
Still, Lehman shares slumped 14% to close at $12.40 on Monday, their lowest level in roughly a decade.
Comparisons have been made to Bear Stearns, which was forced to sell itself to J.P. Morgan Chase in March after clients abandoned the brokerage firm.
"I'm hard pressed to give you many viable buyers of Lehman," said Jeff Harte, a securities industry analyst at Sandler O'Neill & Partners. "Most large banks are focused on their own capital issues."
Even if a bidder did come forward, it would have to win over a lot of Lehman employees -- who control around 30% of the stock -- or risk losing them once the deal was complete, Harte said.
"The employees are not particularly willing to sell, especially at such bargain-basement prices," agreed Stefan-Michael Stalmann, an analyst at Dresdner Kleinwort in Frankfurt.
Shares in Lehman have tumbled more than 80% this year, including sharp falls in recent sessions on speculation that some clients are starting to cut back their business. Those rumors have been denied by the firm and some of its major trading customers.
Lehman is now mulling a handful of options, including a strategic alliance with a partner that it hopes will restore investor confidence, an asset sale, or a possible share buyback, The Wall Street Journal reported on Monday, citing unidentified people familiar with the matter.
Still, Lehman shares slumped 14% to close at $12.40 on Monday, their lowest level in roughly a decade.
Comparisons have been made to Bear Stearns, which was forced to sell itself to J.P. Morgan Chase in March after clients abandoned the brokerage firm.
