Rival banks set to pounce on Lehman clients

By Michael Flaherty and Douwe Miedema

HONG KONG/LONDON (Reuters) - The collapse of Lehman Brothers Holdings Inc has set off a frenzy among rival investment banks seeking to snatch business from the fallen Wall Street firm.

Top dealmakers in the past few days have made trips to corporate headquarters, according to sources within the banks, hoping to poach Lehman clients for everything from merger and acquisition advisory to securities underwriting.

High on their list of targets in Asia are likely to be the Chinese companies Lehman has ties to. Lehman represents top Chinese aluminium maker Chinalco, which led a $14 billion investment early this year in miner Rio Tinto, a minority stake it has said it may increase.

"On the M&A side, the Street is going after everything they know Lehman has," said an investment banking source in Hong Kong who did not want to be named.

In Europe, Lehman was working on the sale of three Eastern European television stations by Newscorp.

It was also seeking second-round bids for the sale of Ireland's Elan Corp's drug delivery unit by mid-September, in a mandate with Goldman Sachs.

Lehman ranked ninth on $37.2 billion worth of deals in year-to-date Asia M&A league tables, according to Thomson Reuters, up from 23rd a year ago.

After failing to strike a deal to sell the company or its assets, Lehman on Monday filed for bankruptcy protection, collapsing under the weight of heavy exposure to subprime mortgage securities. With operations across the globe, Lehman was once the fourth-largest U.S. investment bank.