Putnam: Neuberger sale symbolic but vital

In fire-sale conditions Neuberger Berman could fetch Lehman Brothers Holdings Inc. between $3 billion to $4 billion, according to one veteran investment banker.

Amid fire-sale conditions, Neuberger Berman LLC could fetch Lehman Brothers Holdings Inc. between $3 billion to $4 billion, according to a veteran investment banker.
But “does $4 billion make a difference?” asked Donald Putnam, founder of Grail Partners LLC of Boston. “The Neuberger Berman sale is symbolic more than financial.”
Yesterday, Lehman Brothers chairman and chief executive Richard S. Fuld Jr. said that the company planned to sell a substantial stake in its investment management division as well as slash its dividend.
The embattled firm also intends to spin off to its shareholders the majority of its commercial real estate assets.
Lehman closed today at $4.22 per share, down almost 42% for the day. In earlier trading, the price of the stock touched fresh lows, hitting $3.80 per share.
It market capitalization stood close to $3 billion.
Much hinges on Mr. Fuld’s efforts to sell New York-based Neuberger Berman, Mr. Putnam said.
“If you’ve got a CEO who can get a deal done, then all of a sudden you have a company that comes back to life,” Mr. Putnam said. “[Mr. Fuld will] demonstrate that he can take action.”
However, with the stock price reaching those new lows, Lehman has been forced into negotiations with potential buyers to sell the entire firm, according to reports published late this afternoon.
Last year, Lehman Brothers’ investment management group reported a record $3.1 billion in revenue with $282 billion in assets under management.