Nomura acquires Lehman's Asia arm for $225 million

Nomura Holdings, the biggest brokerage firm in Japan has successfully outbid Barclays and Standard Chartered to bag the Asian operations of the defunct Lehman Brothers for $225 million in a deal following talks over the weekend.

The deal includes Lehman's fixed-income, equities and investment-banking operations across Asia, including Japan and Australia which employs around 3,000 people.

Nomura executives reportedly visited Hong Kong at the weekend to offer the buyout with Standard Chartered and Barclays close at its heel by placing bids, but Nomura offered the highest price for Lehman's Asian assets.

Lehman's main units in Japan, which started operations in 1973, filed for bankruptcy last week following the parent company's Chapter 11 filing. Lehman employs about 3,000 people in 10 offices in Asia, including 1,300 in Tokyo and 800 in Hong Kong. It also employs 250 people in Singapore, mainly in the commodities and trading sectors.

Nomura had gone slow in its overseas operations following the rupture of the speculative economy in the early 1990s, but has now revived its interest in expanding in Asia by having Japan's top mergers and acquisitions advisory service and this acquisition will help it to spread out fast outside the country.

Nomura has secured $5.6 billion in cash by issuing bonds and loans for investment in expanding businesses at home and overseas and has gone on an acquiring spree since then. It acquired a 15-per cent stake for approximately $6 billion in Fortress Investment Group, it also bought Instinet Inc, a US electronic brokerage company for $1.2 billion.

Meanwhile, it is also in contention for acquiring parts of Lehman's European business, which is headquartered in London. The other interested bank is Barclays.

Shares in Nomura rose almost 10 per cent in Tokyo as banking stocks rallied across Asia.