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WEDNESDAY, NOVEMBER 25, 2009
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Secret Lehman Sale Talks Fail

South Korean, Chinese investors balk at hefty $5B price for half of troubled bank

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(Newser) – Secret talks earlier this month to sell up to half of struggling US investment bank Lehman Brothers to South Korean or Chinese buyers fell apart after last-minutes squabbles over details, the Financial Times reports. The bank, which is expected to announce up to $4 billion in writedowns next month, was said to be asking 50% above its book value.

Government-owned Korea Development Bank and China’s Citic Securities met with Lehman officials in New York early this month. KDB and Lehman were close to a deal before talks broke down, possibly because Lehman was seeking almost $5 billion—far more than the sovereign wealth fund wanted to invest, the Telegraph adds. Talks with Citic were more exploratory.

Traffic passes Lehman Brothers headquarters in New York.
Traffic passes Lehman Brothers headquarters in New York.   (AP Photo)
One source tells the Financial Times CEO Dick Fuld has taken a feisty negotiating position despite Lehman Brother's weakened state:
One source tells the Financial Times CEO Dick Fuld has taken a feisty negotiating position despite Lehman Brother's weakened state: "He thinks he is playing with a full deck."   (AP Photo)
Lehman Brothers chairman and CEO Richard Fuld is under pressure to boost capital holdings ahead of next month's earnings report, sure to include more billions in writedowns.
Lehman Brothers chairman and CEO Richard Fuld is under pressure to boost capital holdings ahead of next month's earnings report, sure to include more billions in writedowns.   (AP Photo)
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