Lehman( Lehman Brothers Holdings Inc ) shares up as merger rumor
resurfaces
NEW YORK, May 7 (Reuter) - Shares in Lehman Brothers Holdings Inc jumped on Wednesday as rumors that the company
was about to be acquired swirled through trading floors in New York and Chicago.
Lehman, which has repeatedly surfaced as a rumored acquisition target, declined to comment as a matter of company policy.
Traders said the current wave of talk centered around J.P. Morgan & Co Inc ( JP Morgan & Co Inc ) and Chase Manhattan
Corp as potential buyers at prices ranging upward from $50 per share.
"I keep hearing J.P. Morgan at 50," said one trader.
J.P. Morgan was the more frequently cited potential buyer in New York, with Chase emerging as the favored candidate in the
Midwest.
"We're hearing the rumors here" about Chase as a buyer, said Frank Calta, trader at Dain Bosworth in Minneapolis.
A J.P. Morgan spokeswoman declined to comment. A Chase spokesman was not immediately available.
Shares in Lehman gained 4-1/8 to 38-1/4 in choppy and active trade and options activity also perked up, with volatilities rising
sharply.
The activity put Lehman's shares at a price roughly double where they stood in mid-September, just before a BusinessWeek
article quoted an unnamed banker as saying the firm was actively in merger talks.
Since then, the shares have rapidly gained ground, finding new momentum in early April after Bankers Trust New York Corp
announced it would acquire Alex Brown Inc .
That deal reignited expectations for an industry-wide consolidation and re-focused attention on Lehman as a potential target for
acquisition. |
