Monday, November 29, 1999

Lehman gets OK to hire Sotheby`s, invest in NYC building

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Lehman Brothers Holdings Inc won permission to retain Sotheby's to sell about 450 contemporary art works, including pieces by Andy Warhol and Robert Rauschenberg on Thursday.Judge James Peck of the U.S. bankruptcy court in Manhattan on Thursday authorized the retention of Sotheby's to help sell the works, which also include such artists as Claes Oldenburg, Cindy Sherman, Cy Twombly and Damien Hirst, and to invest $255 million in a midtown Manhattan office building.Lehman acquired many of the art works in the last two decades, particularly through its 2003 takeover of asset manager Neuberger Berman. It has said the Sept. 25 sale could raise $10 million, which it would use to repay creditors.Sotheby's believes some works could be worth more than Lehman estimated. The top lot is expected to be Damien Hirst's 1993 "We've Got Style (The Vessel Collection - Blue)," valued at $800,000 to $1 million.Peck separately authorized Lehman to invest $255 million in a 21-story building at 237 Park Avenue in Manhattan, just north of Grand Central Station, in which it already had a $437 million stake.Lehman said the investment was appropriate because it feared a default by the building's owner Broadway Partners on part of the $1.23 billion borrowed from Lehman to buy the building in 2007.It said the $255 million would be used to acquire some of Broadway's debt, and was "the best means" available to protect Lehman's existing stake, which could be wiped out if another party were to buy that debt.In a third order, Peck also accepted procedures proposed by Lehman for the sale of various real estate assets.Lehman was the fourth-largest U.S. investment bank before filing for Chapter 11 protection from creditors on Sept. 15, 2008, in what is by far the largest U.S. bankruptcy by assets.The company is expected to take several years to wind down, and has said unsecured creditors may recover less than 15 cents on the dollar.The case is In re: Lehman Brothers Holdings Inc, U.S. Bankruptcy Court, Southern District of New York, No. 08-13555. (Reporting by Jonathan Stempel, editing by Bernard Orr)
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