Chillin' out till it needs to be funded
Lehman Brothers on Monday won bankruptcy court approval to sell its prized investment management division, including Neuberger Berman, to a group led by Neuberger’s management, Reuters reported.
Judge James M. Peck of the United States Bankruptcy Court in Manhattan approved the deal at a hearing. The deal is worth $922 million after adjustments, Lori Fife, a bankruptcy attorney from Weil, Gotshal & Manges representing Lehman, said in court.
Separately, Judge Peck approved a settlement calling for $1.27 billion in cash plus securities with a face value of $5.7 billion to be transferred to Barclays in connection with its purchase of Lehman’s core U.S. brokerage business.
The Neuberger management group beat out an earlier offer by private equity firms Bain Capital and Hellman & Friedman, which originally valued the asset management firm at $2.15 billion. That figure was reduced at an auction earlier this month due to the market slump, Reuters said.
Under the deal, Neuberger’s management will own 51 percent of the company and Lehman’s creditors will control the remainder.
The court approval concluded a drawn-out sale process. Lehman put part of Neuberger up for sale in August but failed to find a buyer before filing for bankruptcy in September.