Simpson Thacher represented Lehman Brothers in the sale of substantially all of the North American investment banking and capital markets businesses and operating assets of Lehman Brothers, Inc., a wholly-owned subsidiary of Lehman Brothers Holdings Inc., and certain related assets to Barclays Capital, the investment banking division of Barclays Bank PLC, for consideration consisting of certain assumed liabilities, $250 million in cash and certain contingent considerations. Barclays also agreed to acquire the headquarters of Lehman Brothers, located at 745 Seventh Avenue in New York City, as well as its two data centers located in New Jersey for an aggregate of approximately $1.45 billion. The businesses to be acquired will include Lehman Brothers’ Investment Banking, and Fixed Income and Equities Sales, Trading and Research operations. Approximately 10,000 employees of Lehman Brothers Inc. and Lehman Brothers Holdings Inc. in North America and certain of its subsidiaries will join Barclays upon the closing of the transactions.
Barclays Capital also has agreed to provide debtor-in-possession financing to Lehman Brothers Holdings Inc. of $450 million and a substantial interim credit facility to Lehman Brothers Inc. to fund Lehman Brothers Inc.’s ongoing operations.
The transaction is subject to Bankruptcy Court approval. Lehman Brothers filed an emergency motion with the Bankruptcy Court for the Southern District of New York to seek a hearing to approve a break-up fee and related bid procedures and will seek a hearing in the Bankruptcy Court for later this week to obtain approval of the transaction.
Simpson Thacher attorneys working on this transaction include: John Finley, Lee Meyerson, Elizabeth Cooper, Rhett Van Syoc, Patrick Dowd, Steven Liang, Courage Otaigbe, Hui Lin and Julia Kohen (M&A); Andy Keller, John Ericson, Roxane Reardon, Edgar Lewandowski and Jordan Bleicher (Securities); Justin Lungstrum (Credit); Alvin Brown, Jamin Koslowe and Beth Understahl (Executive Compensation and Employee Benefits); Marcy Geller (Tax); Peter Pantaleo (Bankruptcy); and Michael Naughton and William Kearney (Antitrust).