LEHMAN BROTHERS:NOMURA YESTERDAY rescued another 2,500 Lehman employees after the Japanese bank reached an agreement to acquire the US bank's equities and investment banking business in Europe and the Middle East for an undisclosed sum.

The Tokyo-based bank said it expected to retain a "significant proportion" of Lehman's 2,500 employees, although some would inevitably leave. Nomura is not buying any trading assets or liabilities from Lehman.

Sadeq Sayeed, senior adviser to Nomura's board in Japan, said the bank had reached agreements with the top people in each business line. "Slavery was abolished a long time ago. We cannot control people in any other way apart from creating an environment which is conducive to them," he said.

The news comes just one day after Nomura paid $225 million (€153 million) to clinch Lehman's entire Asian franchise, including Japan and Australia, beating interest from other parties including Barclays. The US bank has some 3,000 staff in Asia, half of which are located in Nomura's heartland of Tokyo.

For Nomura, the acquisition of Lehman's European business will give it the scale needed to compete with its larger international rivals with the aim of increasing its overseas revenues from 20 per cent to more than 30 per cent of its overall revenues by 2011.

"This transaction will enable Nomura to punch its weight in the international market," Mr Sayeed said.

Lehman ranks ninth in the league tables for European mergers and acquisitions so far this year, according to Dealogic, the financial data provider. The bank worked on 41 deals with a total value of $124 billion, giving it a 9.7 per cent share of the European market.

Bain Capital and Hellman Friedman, the US private equity groups, have teamed up to launch a bid for the rump of Lehman's investment management arm, which includes the Neuberger Berman asset management business, and its $35 billion private equity business.

Barclays last week agreed to acquire the private investment management arm of the business, leaving assets estimated to be worth less than Lehman's earlier $5 billion asking price.

The asset management businesses are not part of the bank's bankruptcy, but Lehman has put them up for sale and needs buyers in the next few days or risks losing clients and valued employees.

Senior executives at the private equity arm are also considering a management buyout of their division in case its planned sale falls through. - ( Financial Times service)