Lehman Sweats it Out

Lehman Sweats it Out Lehman Sweats it Out Last week, as temperatures in New York preparedto roll toward 95 degrees and Lehman Brothers' share price fell further, the big independent investment bank run by Dick Fuld was busy trying to close a deal that would give it a much-needed infusion. The estimated $6 billion in capital is expected to come from a variety of investors, including the New Jersey Division of Investmentsthe manager of the state's $80 billion pension fund and investor in fellow struggling investment bank, Merrill Lynch. Previously, with Lehman's travails due to the subprime fallout topping headlines, industry observers had speculated that the bank might be looking for a JPMorgan-like savior to buy the firm out right, or for a government-owned fund to buy an equitystakesimilar to deals struck by competitors Morgan Stanley (which received billions in Chinese capital), Citigroup (which took an infusion from Abu Dhabi) and Merrill (which got its multi-billion dollar boost from Singapore). Unlike these firms, it ap pears Lehman didn't have to go very far to get its billion-dollar Band-Aid. Instead of going overseas, it justcrossed the Hudson River. Although mounting losses, a dismal stock price and a dry deal market doesn't bode well Lehman insiders, there are some bright spots at the firm. Lehman is expected to post severe drops in investment banking and capital markets revenue for the second quarter, and with losses this deep, further job cuts in these divisions seem inevitable. However, the firm's investment management division is expected to report ahealthy rise in business for the quarter, so insiders in that unit have much to celebrate, and should be able to count on their paychecks to keep on coming. Speaking of investment management, we're days away from revealing the results of the second annual Vault Investment Management Survey. So stay tuned to find out which firms insiders rank as the top 25 in the industry. (Hint: Lehman is one of them.)