Going Private, Lehman Edition

Lehman Brothers is now trading at $12 a share, which is less than its asset-management business alone is worth. So at this point it makes perfect sense for CEO Dick Fuld to go private, sell off Neuberger Berman, and basically get the rest of the bank for free. Yes, there would be question marks over how reliable a private Lehman might be as a counterparty, but there are the same question marks over a public Lehman, too. And the private Lehman would still have the same access to the Fed’s discount window that the public Lehman has.

And why stop at Lehman? Washington Mutual, National City, even Freddie Mac — I can imagine how the management at all these banks might consider going private to be an extremely attractive option. Long-suffering shareholders, on the other hand, might not be quite as happy, but at this point they should probably feel happy with anything greater than zero.

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