TOKYO: Japan’s top broker Nomura Holdings said yesterday it would buy Lehman Brothers’ IT support hub in India, taking on another 3,000 workers as it picks up the pieces from the Wall Street giant’s collapse.
Nomura, which is already buying a swathe of Lehman’s operations across Asia, the Middle East and Europe, will take on the failed US bank’s India-based back office and information technology support businesses for an undisclosed sum.
The Japanese broker moved swiftly to snap up Lehman businesses outside of the United States after the once-mighty Wall Street titan was brought down by the financial crisis that has rocked world markets.
The Indian subsidiaries, based in the financial hub of Mumbai, were not included in the earlier deal, but Nomura decided it needed to take on the IT experts responsible for running Lehman’s state-of-the-art stock trading system.
Nomura chief executive Kenichi Watanabe described the latest acquisition as “an important component of our global expansion strategy.”
“It will allow us to significantly enhance our global service platform to support the business expansion that the combined talents of Nomura and Lehman will drive going forward,” he said in a statement.
Financial terms were not disclosed. The Nikkei business daily reported last week that Nomura had agreed to pay “several billion yen” (tens of millions of dollars) for the Indian operations.
Nomura will buy all the assets, as well as the issued and outstanding shares, of the three Mumbai-based companies - Lehman Brothers Services India Private Ltd., Lehman Brothers Financial Services (India) Private Ltd., and Lehman Brothers Structured Finance Services Private Ltd.
The move comes amid reports that Nomura is losing some of Lehman’s top talent to Western rivals, who have traditionally paid more than Japanese banks and offer a work culture that rewards performance above seniority.
Lehman’s six-person team covering the Asian power sector has reportedly defected to Merrill Lynch, while other Lehman bankers have been poached by private equity firm Blackstone Group LP and Swiss giant UBS AG.
Japanese financial institutions, which have been relatively immune to the global credit crisis, have seized the opportunity to expand overseas, buying stakes or assets from troubled Western banks.