After bankruptcy, come the sell-offs. Following on the sale of its European and Middle East assets to Japanese securities firm Nomura See: Nomura to buy Lehman's banking, equities units in Europe, Middle East and its North American operations to British bank Barclays, Lehman Brothers on Monday agreed to sell its investment management unit to Bain Capital and Hellman & Friedman for $2.15 billion, about half the initial bid. Barclays to pick select parts of Lehman for $1.75 billion

The transaction includes Lehman's Neuberger Berman mutual fund division, which oversees about $130 billion, as well as part of a private-equity group that invests in leveraged buyouts and real estate, the companies said in a statement.

As part of the deal with Bain and Hellman& Friedman, a new independent investment management company named Neuberger Investment Management will be created, a release said. Neuberger Berman will be the largest operating unit and it also will include the fixed income and certain alternative asset management businesses of Lehman's investment management division, the release said.

Private-equity firms were the only bidders in a rushed auction of the unit after Lehman went bust. They were attracted by a business with $230 billion in customer assets and a steady cash flow that would have fetched more if not sold under duress.

Boston-based Bain, and Hellman & Friedman of San Francisco paid less than they initially offered separately earlier this month before teaming up, though the transaction doesn't cover all parts of the investment unit that were put up for sale. They will be equal partners, while fund managers and executives will also own a slice of the new firm.

Roy Neuberger and Robert Berman founded the firm that bears their names in 1939 to serve wealthy clients. During the 1950s, it was among the first firms to offer customers mutual funds that didn't charge transaction fees. Neuberger, now 105, retired before the 1987 stock market crash. The fund unit oversees $130 billion.

Lehman bought Neuberger in 2003 for $3.2 billion to expand the firm's wealth management business and later consolidated its asset-management operations into a single division. He had hoped to hold onto a stake in the unit as part of his failed plan to keep the 158- year-old firm afloat.

Lehman's bankruptcy accelerated the sale and forced Lehman to sell the entire business. Private-equity firms Carlyle Group, Blackstone Group LP and KKR & Co. LP weighed competing bidding for the unit and eventually opted not to. Clayton Dubilier & Rice made an initial bid.

After deciding to team up, Bain and Hellman encountered protracted negotiations complicated by Lehman's bankruptcy. Portfolio managers pushed for more compensation as part of the deal and talks stalled around how the new firm would be managed as well as which private-equity funds would be included and how they'd be valued.

Also included in the sale is Lehman's $35 billion private equity business, managed by Michael Odrich, a 22-year Lehman veteran. That unit manages almost 40 funds spanning real estate, leveraged buyouts and secondary interests in private-equity pools run by other managers.

Odrich will join the new company, as will Tony Tutrone, head of the private funds investment group. The transaction doesn't include Lehman's merchant-banking business, real estate, venture capital or certain hedge funds, according to the statement.

The sale also doesn't include Lehman's private-investment- management division, which the firm agreed to sell separately to Barclays Plc. London-based Barclay's last week concluded its purchase of Lehman's North American investment-banking business.

Lehman must get approval for the sale to the buyout firms in federal bankruptcy court, where Judge James Peck will determine whether the auction drew the best possible price from a full field of bidders. The sale doesn't include Lehman's stakes in hedge-fund managers GLG Partners and Ospraie Management.

Hellman & Friedman was Warren Hellman, a former Lehman president, and Tully Friedman in 1984.  It bought fund manager Gartmore Investment Management Plc in 2006 for about $927 million, gaining $47 billion in assets under management. The firm helped create Farallon Capital Management LLC, the San Francisco-based hedge-fund manager founded by Thomas Steyer, and invested in Franklin Resources Inc., the San Mateo, California- based owner of the Franklin and Templeton mutual funds.

Bain, also founded in 1984, most recently teamed with Blackstone to buy the Weather Channel with NBC Universal Inc  NBC ties up with private equity partners to buy The Weather Channel for $3.5 billion. Previous financial-services deals included the purchase of Web broker Datek Online Holdings Corp.