Lehman has agreed to sell its Neuberger Berman money management unit to private-equity firms Bain Capital and Hellman & Friedman for $2.15 billion. That’s quite a discount from a few months ago, when people were estimating that Neuberger could garner as much as $7 billion. The money-management unit is typically described as Lehman’s “crown jewel.” (Insert totally expected “getting kicked in family jewels” joke here.)
DealBook has some details:
- The sale includes a fixed-income business and some alternative asset holdings but not Lehman’s holdings in various hedge funds.
- Unsurprisingly, these two private equity firm’s aren’t buying Lehman’s own private equity businesses. UPDATE: Sources close to the deal say that the DealBook version of this is not entirely accurate. Some of the private equity operations of Lehman are in fact going with the new Neuberger entity.
- The company will operate as a new independent firm, Neuberger Investment Management, with $230 billion in assets under management.
- “George Walker, Lehman’s global head of investment management, will head the newly independent company, while Joseph Amato will continue to lead Neuberger Berman itself,” DealBook writes.
The Wall Street Journal says the process was delay because of “protracted negotiations with Neuberger’s money managers.” They’re consent to the deal was essential, since many could just leave the firm and take their clients with them. Dealing with those wealthy and relatively autonomous money managers is described as “herding cats.”
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