Blackstone Inc (BX)

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Is this something we want?

Lehman Brothers (LEH) is moving toward a possible sale of its investment management business, The Wall Street Journal reports. The firm has begun circulating financial information on the unit, which includes its Neuberger Berman unit, to a group led by private-equity firms Carlyle, Hellman & Friedman and General Atlantic, the Journal reports, citing people familiar with the situation. Other possible bidders include Blackstone (BX).

The news comes as Lehman weighs whether to seek a buyer or partner for the investment management unit as the firm’s financial woes mount. On Tuesday, JPMorgan became the latest firm to boost its estimate of the writedowns that lie in store for Lehman in the third quarter ending this month, to $4 billion.

Neuberger has been a strong performer since Lehman bought it in 2003, but Lehman’s big holdings of risky assets could expose it to outsize losses in coming quarters as house prices continue to fall, and Lehman has already raised capital three times this year. Like Merrill Lynch (MER), which last month ended up doing a dilutive stock sale and selling its stake in financial services company Bloomberg after saying repeatedly it would do neither, Lehman could end up having to sell some of its best assets simply to raise cash. Lehman, which fell 7% in trading Monday, should be in for another active session Tuesday