Is a takeover of Lehman Brothers reasonable?

August 25, 2008 | By Jim Kim

The ubiquitous Richard Bove, analyst at Ladenburg Thalmann, made headlines yet again when he recommended that his clients buy Lehman Brothers because the "stage was set" for a hostile bid. But not everyone buys that, notes Financial News Online. The big question is, who would buy it? Few big banks are positioned to make a hostile bid. They have their own issues and do not need the distraction. I could see some firms bidding for asset management properties, but that would leave the rest of the company to the vultures. So while we may not see a takeover attempt, we may see a white knight move. There may be a company that rides to the rescue in a negotiated deal that will keep a few parts of Lehman alive, while shutting down others, like most of the mortgage-related machinery. The terms will be interesting. The market currently values the non-asset management portions of the business at about zero.

For more:
- here's a Financial News Online article
- KDB warned against buying Lehman Brothers. Article