Tuesday, May 5, 2009

Neuberger-Berman Breaks Free of Lehman Brothers

A 70 year old money management firm, Neuberger Berman is officially an employee owned company. It broke free of defunct Lehman Brothers after eight months of drama. HFN reported:

In December 2008, the firm announced the planned employee-led buyout. The deal called for the new owners to hold 51% of the new company with the remaining 49% being held by the Lehman estate. According to Randall Whitestone, a spokesman from Neuberger, more than 200 employees are included in that ownership group.

The original buyer was a consortium of private equity funds. Bain et al bid $2.15 billion for Neuberger, but that deal became uncertain. NB management paid $922 million (a $1.2 billion discount) for a firm with $158 billion in assets under management. Neuberger management did the deal with no debt. Sweet!

Winners include George Herbert Walker, Neuberger's CEO and cousin of ex-President George W. Bush. Lehman Private Equity has Jeb Bush as an adviser. Did Neuberger trade for Jeb before spinning off from Lehman's corpse?