Nomura buys Lehman's Europe investment bank arm

LONDON: Japan's Nomura Holdings Inc agreed to buy Lehman Brothers' equities and investment banking business in Europe and the Middle East, in its second swoop on the bankrupt U.S. bank's overseas assets in 24 hours.

Japan's biggest brokerage said it expects to retain "a significant proportion" of the 2,500 staff employed in the businesses.

It did not say how much it would pay but said it would not take on any trading assets or trading liabilities.

Lehman filed for bankruptcy protection last week. Britain's Barclays Plc bought its core U.S. broker-dealer business and Nomura bought its Asia-Pacific arm on Monday. The deals are expected to save most jobs in each region.

Nomura was the frontrunner to buy the European arm after entering exclusive talks with Lehman's administrators in Europe, PricewaterhouseCoopers (PwC), on Monday.

It adds to a run of big deals by major Japanese banks, who have been less hit by financial turmoil and asset writedowns in the past year than rivals, and are snapping up assets from or injecting capital at banks hit by the credit crunch.

Japan's biggest bank, Mitsubishi UFJ Financial, is planning to buy up to a fifth of Morgan Stanley for up to $8.5 billion.

Nomura, the first Japanese securities company to establish an overseas office 81 years ago, said it had struck "two transformational deals" in less than 24 hours.

Its immediate task is to get the Lehman businesses back operating under the Nomura name, it said.

"This transaction will significantly extend our European footprint and international reach, enabling us to realize our strategy of delivering Asia to the world," Nomura Chief Executive Kenichi Watanabe said in a statement.

Much of the business is based in London, where Nomura already has its European headquarters and has 1,500 staff. Before this week's deals, it had 18,000 staff in 30 countries.

PwC said the deal included investment banking and equities in Britain, the Netherlands, Spain, Italy, Germany, Sweden, Qatar, Dubai and Kuwait.

Barclays had also bid for some of Nomura's Asian and European assets, but it didn't want all of the businesses, people familiar with the matter said.