Private matters

July 15, 2008

Lehman’s HeadquartersA day after Fox-Pitt Kelton analyst David Trone suggested Lehman Brothers Holdings Inc may be better off going private, the investment bank may be ready to do just that. Lehman Chief Executive Richard Fuld is considering ways to take the Wall Street bank private, but it’s not quite clear how such a move might work, the New York Post reported, citing sources. Lehman’s shares have plunged this year on the back of rumors and questions about its solvency. Talks of privatizing Lehman have got serious as a result, the papers said. The company’s shares closed down more than 14 percent on Monday, reaching their lowest level since August 1999. Lehman’s shares have fallen about 81 percent so far this year. Trone said on Monday Lehman may be better off going private to shake off short sellers that are spreading bogus rumors about the bank.

Those nasty rumors, if that’s what they are, may come back to bite some folks on the hindquarters. The Securities and Exchange Commission has sent subpoenas to more than 50 hedge-fund advisers as it investigates whether individuals spread false rumors to manipulate shares in Lehman and Bear Stearns Cos, The Wall Street Journal said, citing a person familiar with the matter. You remember Bear Stearns, right? You know, the one that initially sold for about $2 a share? No wonder Lehman may be thinking about getting out of the stock market limelight.

And now for something completely different (different from Lehman, anyway). Hong Kong phone company PCCW Ltd says it expects to shortlist bidders for its media and telecoms unit within a month. The deal could fetch more than $2.5 billion. Private equity firms are among those bidding for the newly formed unit, known as HKT Group Holdings, group managing director Alex Arena told reporters on Tuesday. Reuters reported on Friday that the Blackstone Group and Providence Equity Partners were among those pursuing a bid for HKT.

More deals of the day:

** Private equity firm Oak Hill Capital Partners purchased eight News Corp television stations for about $1.1 billion.

** Bank of Nova Scotia will expand its wealth-management business by buying the Canadian operations of U.S. online brokerage E*Trade Financial Group Inc for $442 million cash, the companies said.

** Barrick Gold Corp is launching a C$354 million ($350 million) hostile bid for Cadence Energy Inc as a hedge against oil prices to get control of soaring production costs, the world’s top gold miner said.

** Lawson Inc, Japan’s second-largest convenience store, will spend at least 3.98 billion yen ($38 million) to take control of discount grocery chain Ninety-nine Plus Inc, aiming to use acquisitions to grow in a mature market.

** China’s CITIC Resources Holdings has raised its stake in Australian miner Macarthur Coal Ltd to 20.39 percent, overtaking global steelmaker ArcelorMittal as the top shareholder.

** Hungarian drug maker Richter Gedeon said its takeover of Poland’s Polpharma was not completed as scheduled on Monday because Polpharma owner Genefar did not agree to the terms of the closure of the deal.

** French seeds company Vilmorin said it was taking a 25 percent stake in Australian Grain Technologies (AGT) for an undisclosed amount.

** Banca Popolare dell’Emilia Romagna has suspended plans to buy Banca delle Marche, it said in a statement.

** Irish billionaire investors the Quinn family said they would buy a 15 percent stake in Anglo Irish Bank which they saw as a long-term investment despite difficulties facing international banking.

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