Lehman Brothers Holdings Inc. entered into talks with potential buyers of the securities firm after Moody's Investors Service said the company must find a "stronger financial partner" and the shares plummeted.

Bankers from other firms are reviewing Lehman's books today, people with knowledge of the situation said, declining to identify the potential acquirers. Mark Lane, a spokesman for Lehman, declined to comment.

Without a "strategic arrangement" in the "near term," Lehman's credit-ratings may be downgraded, Moody's said yesterday after the New York-based investment bank announced the biggest loss in its 158-year history. Lehman, led by Chief Executive Officer Richard Fuld, fell as much as 46 percent in New York trading today, ceding its spot as the fourth-biggest U.S. securities firm by market value to Raymond James Financial Inc. in St. Petersburg, Florida.

"While the number of potential acquirers at this point is very few, Moody's action certainly raises the specter of takeout, potentially at a very low price," said Merrill Lynch & Co. analyst Guy Moszkowski in a report today. He lowered his recommendation on the stock to "no opinion," saying a potential "take-under" makes it hard to gauge a price target.

Lehman fell $2.43, or 34 percent, to $4.82 at 12:31 p.m. in New York Stock exchange composite trading. The drop reduced Lehman's market value to about $3.3 billion. Raymond James, a regional brokerage, is valued at about $3.7 billion.

CNBC reported that Lehman was in talks with possible buyers earlier today.

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