Press Release
| July 3, 2008
Dewey & LeBoeuf Advises Lehman Brothers on Asset Management Mandate for Sachsen LB Portfolio
(Frankfurt, July 3, 2008) - Lehman Brothers Asset Management has won a mandate to manage Sachsen LB's portfolio of distressed assets. The portfolio, which was seriously affected by the US subprime mortgage crisis, is valued at approximately €17 billion. Lehman Brothers was advised by attorneys from the law firm Dewey & LeBoeuf in Frankfurt, London and New York.
The credit exposures now being managed by Lehman would have virtually bankrupted Sachsen LB, had it not been for a concerted rescue effort mounted by the government of the German federal state of Saxony (which acted as guarantor), the Landesbank Baden-Württemberg (LBBW) regional central bank and a group of banks represented by the German Savings Banks Association (DSGV). Now that Lehman has taken on this mandate, one of the largest German credit portfolios to be hit by the subprime mortgage crisis has found a new manager.
Dewey & LeBoeuf's team of advisors led by partner Dr. Kai-Uwe Steck advised Lehman Brothers in Germany, the UK and the US on the legal aspects of the asset management mandate (which included specific liability issues in the banking sector), on the taxation aspects and on the framing of asset management and financing agreements. Most of the advice was provided by lawyers and tax experts from Dewey's Frankfurt office and its German desk in London, which has recently been beefed up.
"The fallout from the credit crunch has been the issue dominating the banking industry over the past few months, and a number of advisors have been working at various levels to resolve this problem", stressed Kai-Uwe Steck. "We are delighted that our team was involved in finding a solution for Sachsen LB's portfolio as well as advising Lehman Brothers on a deal that is likely to set a benchmark."
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