Barclays agree to buy the core asset of lehman brothers investment banking division
Banking giant Barclays bank has agreed to buy some of the core assets of stricken US investment bank Lehman Brothers for 1.75 billion dollars. $1.5 billion for its New York headquarters and two data centers and $250 million for the trading unit following negotiations in New York, the bank said on Wednesday, Sept. 17. The deal still requires backing from a bankruptcy court.
Lehman Brothers’ US parent filed for bankruptcy protection a couple of days ago, with the UK main trading operation also going into administration.
The US arrangement allowed the group to pursue to sale of its broker-dealer operations, as well as its investment management division. Another subsidiary, Lehman Brothers Asset Management, was also not subject to the bankruptcy petition.
It was a similar story in the UK, where a number of business areas were not part of the administration process, including Lehman Brothers’ asset management and corporate finance business.
It is understood that Barclays has steered clear of becoming involved with so-called “toxic investments” made by Lehman Brothers in volatile residential and commercial property markets.
Approximately 10,000 Lehman employees work for the fixed income and equity sales, trading and research and investment banking businesses that Barclays is set to acquire, Barclays said.
But there has been criticism in London that none of the 5,000 Lehman Brothers’ employees in Britain will benefit from the Barclays move.
