Three 'credible' buyers circling Lehman Brothers in London

Three "credible" parties are interested in buying the London-based investment banking arm of Lehman Brothers, the US finance giant which was declared bankrupt last week.

Tony Lomas, administrator at PricewaterhouseCoopers (PWC) for Lehman Brothers International (Europe), said on Friday that he had received offers of interest to buy the London-based investment banking business and parts of the equity trading arm, which together employ about 600 people. These include corporate finance and mergers and acquisitions activities.

"They are all credible offers and all from very different financial institutions. We hope that talks can start as soon as possible," he said.

Barclays, which is buying Lehman's US investment banking operations for $1.75bn (around £1bn), could be interested in parts of the London operation. Mr Lomas added that interest had also been shown in the other parts of the business: Lehman's broker dealer, which employs 3,200 people; the asset management arm, which employs 200; and real estate, where only a handful of people work.

The administrator added that he had secured funding of $100m from CarVal, part of the Cargill group, to finance the salaries of staff for September. This is what is known as "dip financing" or "debtor- in-possession funding" and provides money to an administrator to unscramble the business and, hopefully, keep it intact enough for a sale.

Many of Lehman's 4,000 employees have stayed on to help PWC with the administration process – specifically with the unwinding of the massive trades on which Lehman, one of the biggest single traders on the London Stock Exchange, still has billions outstanding. Those who have stayed on to work with PWC will be paid for September.

Most are involved in helping the administrator unwind the positions with Lehman counterparties. Mr Lomas added that he hoped he and the staff would be able to clarify trading positions this week. "My inbox has been swamped with about 5,000 emails which I haven't even been able to get to read. But next week we should start sorting this."

Lehman is headed by Christian Meissner in London following the abrupt departure of Jeremy Isaacs a few weeks before the crisis at the bank unravelled.

Lehman, led by Dick Fuld, went bust on Monday following the decision last Sunday in the US to file for bankruptcy protection, the biggest in US history.

In New York on Friday, a high court judge was due to approve the sale of Lehman's US investment banking operations to Barclays, calling the bank a "melting iceberg". Barclays is also considering other Lehman operations in Asia.