Is this the end for Lehman Brothers?
News that one of the main icons of the US investment industry is again in serious trouble has seen the shares of Lehman Brothers Holdings fall by over 40%. Despite reports last month that the group was in talks about a vital capital injection it seems that those talks, which were with the Korea Development Bank, have broken down with no agreement.
If this is the case - although as yet the reports are not confirmed - this could well spell the end of one of the US's main capitalist ventures. The shares have now fallen from a 52 week high of over $67 to just under $5 and the immediate future looks very bleak. Under normal circumstances there would be no shortage of investors to bail the group out but the balance sheet has been holed below the water line and the company is sinking fast.
Sub-prime market loses and other investment falls have seen this bastion of the US falling by the wayside. Can it be saved? Will the markets recover and bail the group out?
If the suggestions in the market are true, the company is in desperate need of investment capital to replenish its balance sheet. While we have seen the US government step in on a number of occasions of late there are very faint hopes that any assistance will be forthcoming for Lehman's.
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