Lehman Brothers Holdings Inc. said Sam Zell’s Equity Residential would be a “contentious” partner in Arapahoe County-based Archstone and impair the value of bankrupt Lehman’s biggest real-estate asset, according to a court filing.
Lehman, which is trying to gain control of Archstone, made the statement Friday in support of its plan to pay about $1.3 billion for 26.5 percent of Archstone held by Bank of America Corp. and Barclays Plc. Equity Residential had offered to buy the stake and retains an option on the banks’ remaining 26.5 percent stake.
Lehman aims to sell or liquidate Archstone for $6 billion to help pay creditors with claims of about $370 billion, and to do that must gain control of the company, according to a person familiar with the plan. Zell, with a 26.5 percent stake, could thwart all of Leh man’s plans for Archstone, Jeffrey Fitts, Lehman’s co-head of real estate, said in the court filing. Equity Residential could “single-handedly drive down the value of Archstone and hinder the debtors’ ability to exit their investment in Archstone,” he said.
Zell didn’t immediately respond to e-mails seeking comment on Lehman’s filing. Linda Sandler, Bloomberg News
