Lehman (LEH) May Raise Cash, Dilute Shareholders

Lehman (LEH) may have to raise several billion dollars. With its market cap below $13 billion, that could be painful for current holders of its common shares. According to Reuters, "Lehman Brothers Holdings Inc is expected to follow in Merrill Lynch & Co Inc's footsteps and sell a lot of risky assets at a loss."

Lehman currently has $65 billion in mortgage-related paper.

With a share price of just over $18, bringing in another $5 billion could drive the stock closer to $10.

Douglas A. McIntyre