Lehman Brothers to invest in hedge fund firms

The Financial Times reports that Lehman Brothers is putting together a private equity-like fund, in which it will invest $1 billion, that will seek hedge fund firms. Many are expecting more hedge fund firms to put themselves up for sale. The problem is that there aren't a lot of buyers out there, given the industry's woes as of late. Lehman's new fund will address that, and hopefully deliver some assets fairly cheap. It has bought and sold funds in the past. The FT notes Lehman still owns minority stakes in Spinnaker Capital and DE Shaw, the $35 billion quantitative and multi-strategy fund. It's unclear how low hedge fund firm prices will go; Lehman is betting there are some great deals out there.  

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