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Private Equity Firms Interested in Buying Lehman
but top officials said the company wasn't for sale, people close to the matter say.
The news comes as Lehman prepares to preannounce third-quarter results at 7:30 am Wednesday morning in New York. Lehman will also provide investors with some guidance on the firm's "strategy".

Lehman is expected to announce a massive loss, and writedowns from troubled debt. The firm has been hammered in recent days as it attempts to raise capital through infusions from banks, and the sale of its investment management business.

Some big investors are praying for an outright sale of the firm, whether its private equity or a large U.S. bank, like Bank of America.

It is unclear just how much private equity firms are willing to pay for Lehman; sources say senior executives at Lehman told the firm that rather than purchase Lehman, they could bid on its asset management unit.

It is also unclear if regulators will allow a private equity firm to buy a major Wall Street player, particularly one with huge amounts of illiquid securities on its books, like Lehman.

But with the 45 percent drop in the firm's share price on Tuesday, Lehman may be open to even low ball offers from private equity firms despite the famously independent streak of its CEO Richard Fuld.

Lehman [LEH 7.79 -6.36 (-44.95%) ] shares fell to their lowest level in nearly a decade Tuesday amid growing concern that Wall Street's fourth-largest investment bank would be unable to raise needed capital in the wake of huge losses.

(Watch the accompanying video to hear more from Bove on Lehman's shares...)

The securities firm has been seeking to boost liquidity after suffering $8.2 billion in write-downs and credit losses since the financial crisis began last year.

The steep decline in Lehman's shares began shortly after Dow Jones Newswires reported that the head of South Korea's financial regulator said talks about a possible investment had ended. Lehman Chief Executive Richard Fuld had been in negotiations with state-owned Korea Development Bank for several weeks about a capital infusion.

However, it appears that report itself is being disputed. Yoo Jae-hoon, a spokesman for South Korea's Financial Services Commission, flatly denied any such statement was made. He said the regulator was "not in a position" to "broadcast how the deal is going."

Mark Lane, a spokesman for Lehman Brothers, declined to comment. A spokesman for KDB could not immediately be reached for comment.

http://www.cnbc.com/id/26631244