Could Lehman Brothers go private? There's been lots of speculation that Lehman Brothers could be a takeover target, although its been hard to find plausible buyers in teh wasteland of Wall Street. (So hard, in fact, some have wondered if Lehman might be taken under--acquired for less than it's current share price.) Yesterday, Fox-Pitt bank analyst David Trone, suggested Lehman go private at a 25 percent premium. Today the New York Post is reporting that this is seriously being considered.
"Lehman Brothers' CEO Dick Fuld is seriously mulling a way to take itself private and out of the public eye," The Post reports.
On a related note: this anonymously sourced story should be bullish for Lehman's stock price, to the extent that it is believed by investors. Will the SEC investigate this rumor?
Lehman Looks Hard At Taking Firm Private [New York Post]
Posted by guest , Jul 15, 2008 9:16AM
are they going to stick this on the employees as well--eg, rather then pay them a salary, use all that salary accural towards an employee buyout...
Posted by guest , Jul 15, 2008 9:16AM
if the management team and employee base really believe in the future of their business, LEH should do a management buyout with BRK as the anchor outside investor
Posted by guest , Jul 15, 2008 9:19AM
wouldn't it be cheaper to just start a new firm
Posted by guest , Jul 15, 2008 9:24AM
this will be the new game all these morons play. destroy equity values and go private. then cash out on an ipo down the road.
stick with the deeply discounted debt in this rigged carnival game.
these weasels can't hide from debt.
Posted by guest , Jul 15, 2008 9:27AM
Where are they going to get the money to go private? Buffett had way too much fun with Solomon to get involved with a broker dealer again.
Posted by guest , Jul 15, 2008 9:35AM
@9:27
you're kidding, right?
the mkt cap on LEH is like 8 billion right now. there are a couple of hedge funds who have made almost that much organizing old fashioned bank runs in financials the last 5 months...lol
hell, you could find 8 billion worth of stock in googles couch cushions.
leh debt just moves on.
wait a year or three and go public again. just make sure all the insiders get lots and lots of new equity and options.
Posted by guest , Jul 15, 2008 9:39AM
what a joke...if the market think your company is crap and beats it doen then hey take it private so you are "not in the public eye".
This is a scam...they will go public again and all cash out at the equity holders expense.
The SEC should not allow this type of shell game to occur.
Posted by beentheredonethat , Jul 15, 2008 9:39AM
Forget any talk of a premium.....If that's their plan, they would line up the necessary financing, let the bad news out in the most negative light possible, wait for the stock to get crushed, and then create the inflection point by stepping in to buy back shares and announce the deal. I still don't believe its going to happen. I think the insiders know they've got a goose egg on their hands. Today should tell alot.
Posted by guest , Jul 15, 2008 9:41AM
Carney, good work on keeping this charade about investigating rumors going. This is such bullshit that the company can float rumors to drive up the stock price but then complain that traders are spreading rumors to drive down the stock price.
Posted by guest , Jul 15, 2008 9:46AM
@ 9:41
Exactly...This is now the company leaking bullshit rumors to control the decimation of their stock and buy themselves time to figure out what to do.
This is the stuff the SEC should be looking at!
Posted by guest , Jul 15, 2008 9:46AM
LEH needs to merge with IndyMac in order to survive.
Posted by Investorcluzo , Jul 15, 2008 9:47AM
this is yesterday's discussion. leh bought neuberger in '03 for $2.7 billion, all of leh trades for $6.8 billion today. let's just assume the value of the asset management business actually grew 5% - 10% annually, that would mean it's worth $3.5 - $4.3 billion today (assuming the multiples didn't shift). so the "investment banking" business is really trading for $2.5 - $3.3 billion.
as I said yesterday, blackstone has been building its own investment bank internally and TPG seems to like the financials. this is a small check for them to write (and no, this will be not be a premium transaction). the question is how to ring fence the mortgage liabilities. starting new is not a great option because you have to "re-create the wheel", then there's the messy issue of poaching all the employees which creates lawsuits.
Posted by guest , Jul 15, 2008 9:49AM
so how many nyc wall street'ers get bounced the next 6 months?
50k?
75k?
100k?
and they're still building 1800 p/sq/ft condos with hardwood floors all over the place...lol
this is nuts.
well at least we have 30 million dollar scaffolds in the east river with water spitting out of 'em...
Posted by guest , Jul 15, 2008 9:49AM
Investorcluzo - stop being a tree hugger.
Posted by Corningstone , Jul 15, 2008 9:54AM
Cluzo, you rock and are ahead of the game - I think the NYP just picked up your tip from yesterday!
Posted by guest , Jul 15, 2008 9:58AM
@9:49,
my guess is that 25K people get shafted. plenty of new waiters going to be doing the rounds of restaurants and bars. the banker chicks have no luck in strip clubs, or they would do well.
but the condos are going to go to saudi sheikhs, and russian oligarchs and chinks from china and japs.
Posted by Investorcluzo , Jul 15, 2008 9:59AM
@cobblestone: duly noted, but I didn't want the peanut gallary coming back saying that I said the same $hit yesterday:
http://dealbreaker.com/2008/07/are_you_happy_steve_liesman_ar.php#comments
and for the record, chuck-e-cheesehead broke 'dat story yesterday:
www.cnbc.com/id/15840232?video=793129321&play=1
@9:49 - stop calling me tree hugger. I'm not your buddy, guy!
Posted by guest , Jul 15, 2008 10:02AM
ML 1st year top bucket bonus - 95K
Confirmed.
Posted by guest , Jul 15, 2008 10:05AM
anyone know what first years at the Shake Shack are getting paid in bonus?
Posted by guest , Jul 15, 2008 10:09AM
if this weren't so serious it would be laughable.
they're taking every bank and brokerage apart.
@10:05 - i think you get to go on bowling outing with your manager jose, but you have to pay.
Posted by guest , Jul 15, 2008 10:10AM
10:05
$3.5/hr, 20% tip-out on the house, free hat and apron.
Confirmed.
Posted by guest , Jul 15, 2008 10:10AM
They get mayo - and they will like it.
Posted by Corningstone , Jul 15, 2008 10:14AM
@Cluzo - yep I posted under the pseudonym of 'guest'and thanked you yesterday for the link -everyone else seemed to miss it, good work.
CORNINGstone
Posted by guest , Jul 15, 2008 10:14AM
My brother works at Shake Shack and he made over $100K last year.
Posted by guest , Jul 15, 2008 10:15AM
@9:49 - You just don't understand Manhattan real estate. New York City is not Las Vegas or Miami, real estate prices will NOT fall here... while the banks are going to have issues, the rest of the city will take up the slack and continue to purchase on the high end. But even if they didn't come through, there is plenty of foreign money floating in to pick it up.
and, 100K.
Posted by guest , Jul 15, 2008 10:17AM
is 100k for 1st, 2nd or 3rd year?
i got serious student loans to pay.
Posted by guest , Jul 15, 2008 10:21AM
What would going private do to analysts? Second year ones, the incoming first year ones and the summers?
Please let me know - I'm working there this summer and the people here won't tell me anything thinking that I'm just a stupid bitch on their rotational sophomore program.
Posted by guest , Jul 15, 2008 10:27AM
hi 10:15,
yeah, you're right. i just don't understand manhattan real estate.
like i could never understand how i was able to purchase a 1700 square foot high floor full service condo in prime manhattan back in 1991 for 189k, especially since the guy i bought it from paid ~275k 2 years before.
you keep dreaming that it's different just this time.
i'll keep living in denial. and my nice paid for brooklyn brownstone.
sorry.
Posted by guest , Jul 15, 2008 10:28AM
@ 10:21
you are.
Posted by guest , Jul 15, 2008 10:40AM
@10:28 They all are.
Posted by guest , Jul 15, 2008 10:48AM
@10:27 - you consider prime manhattan to be brooklyn?? Haha. Yeah, that's right, stay off the island.
Posted by guest , Jul 15, 2008 10:54AM
@10:48 My story and I'll stick with it.
Posted by guest , Jul 15, 2008 10:58AM
hi 10:48am
i was born and raised in nyc so please pardon my ignorance.
i still own the condo in manhattan. does that count? every year i say i'm going to sell it, but now i fear i've waited too long. any advice?
brooklyn is nice. i get to have a car because i have a garage. i like driving. the only thing i worry about is my oldest is approaching middle school and the schools get a little dicey. i'm hoping he gets accepted into the G&T school in my neighborhood, or i'll be forced to send him to a private school like poly prep and i really want to avoid that.
anyway, have a nice day.
Posted by guest , Jul 15, 2008 11:20AM
People outside Manhattan are irrelevant.
Posted by guest , Jul 15, 2008 11:21AM
@ 11:20
Clearly you are irrelevant!
Posted by guest , Jul 15, 2008 11:25AM
hi 11:20am,
are there specific neighborhoods within manhattan which make a person relevant?
i like washington heights.
Posted by guest , Jul 15, 2008 11:30AM
Only core Manhattan counts.
Posted by guest , Jul 15, 2008 11:42AM
@10:58 - just send your kid to Regis (which is in Manhattan by the way = relevancy).
Posted by guest , Jul 15, 2008 11:56AM
@ 11:42. If his kid is a) a girl or b) not baptized Catholic, Regis is not an option. And he still needs a bridge loan in the form of middle school.
Posted by guest , Jul 15, 2008 11:59AM
@11:56 - Regis is a Jesuit school and it's free for all (pending you're accepted and that's the rub).
Posted by guest , Jul 15, 2008 11:59AM
Sorry, I see the kid is a boy.
Posted by guest , Jul 15, 2008 12:17PM
thanks guys,
regis is a great school but i'm not really comfortable with a 10 year old traveling that far. besides, he'd sooner get accepted to my local G&T public intermediate school than regis. he's a really a bright boy and test super well.
i don't want turn this into a chatroom, sorry - lol
Posted by guest , Jul 15, 2008 12:25PM
Plus, first you send your kid to Catholic school, then he wants to move to Chelsea, then he starts performing on Christopher Street and finally he walks the streets of the MPD late at night.
Posted by guest , Jul 15, 2008 12:45PM
1021...if youre on the soph rotational program, that means youre a minority.
its racism man, ra-cism.
Posted by guest , Jul 15, 2008 1:54PM
Manhattan needs to clean up the garbage
Posted by guest , Jul 16, 2008 12:02AM
@10:21 - what group are you in now and where do you want to be? I have contacts and can find out the plan. What group now and where do you want to be?