NEW YORK - Lehman Brothers, in a desperate bid to survive, announced plans Wednesday to sell a majority stake in its prized investment management business and said a sale of the entire company is possible.

Lehman, battling the nation's worst financial crisis since the Depression, also said it would spin off a troubled real estate unit and slash its dividend. Those moves come as the nation's fourth-largest investment bank reported an almost $4 billion third-quarter loss, boosting its losses so far this year to about $6.5 billion.

The plan was aimed at raising capital and regaining investor confidence in the 158-year-old firm.

It was also seen as a reconstruction of Lehman Brothers, which has been devastated as the housing slump evolved into a global credit crunch in the past year. Pressure has been mounting on Chief Executive Officer Richard Fuld to save the firm from the same fate that felled rival Bear Stearns Cos.

Fuld, the longest serving CEO on Wall Street, rescued Lehman Brothers from the fallout of the Russian credit crisis and collapse of Long-Term Capital Management hedge fund in the late '90s. This time, he's hopeful the actions will "de-risk and resize" the company but concedes the only company he's ever worked for could be sold entirely.

"If anybody came with an attractive proposition that was compelling for shareholder value, it would be brought to the board, discussed with the board, and evaluated," Fuld told investors on a conference call. "We remain committed to examining all strategic alternatives to maximize shareholder value."

The company said it will auction a 55 percent stake of the investment management business, which includes fund manager Neuberger Berman that it bought in 2003. Fuld said the firm was in late-stage talks with potential buyers for the business, which analysts value at up to $10 billion for the entire business.

Lehman will also spin off $25 billion to $30 billion of commercial real estate investments into a separate publicly traded company, to be called Real Estate Investments Global, in the first quarter of 2009. Financial regulators forced Lehman to mark down the value of those assets on its books, but those same restrictions will not be placed on the new company.

Investors got more bad news after the company slashed its dividend to 5 cents per share from 68 cents per share in a move that will save an estimated $450 million a year.

But Lehman shares fell 54 cents, or 6.9 percent, to close at $7.25, after plummeting 45 percent on Tuesday.

Wall Street remains skittish about financial stocks since the near-collapse of Bear Stearns in March. Like other investment banks, Lehman has been hit hard by deterioration in the credit and mortgage markets since the middle of 2007. Global banks have so far lost more than $300 billion from mortgage-backed securities and other risky investments.

The moves are intended to prove to Wall Street that the embattled bank has enough liquidity to survive. But, there still remains uncertainty among analysts about whether the strategy will work in the end.

If Lehman moves into the future without its investment management business, issues regarding its future and sustainability as a pure-play investment bank arise," said Cubillas Ding, a senior analyst with Boston-based financial research and consulting firm Celent. "Finding stable funding sources, especially when the markets are not looking to recover in the short-term, is an issue that senior management needs to provide a compelling solution for."

Ding and other analysts also point out that Lehman still has exposure to a high concentration of risk to real estate and related investments. Lehman's quarterly loss includes gross write-downs of $5.3 billion on residential mortgages and $1.7 billion on commercial real estate positions.

The results reflect a continued decline in Lehman's portfolio - in the second quarter the company lost $2.8 billion for the period. It earned $887 million in the third quarter a year ago.

Lehman said it has reduced its residential mortgage exposure by 31 percent to $17.2 billion, and expects its sale of $4 billion of its U.K. residential mortgage portfolio to BlackRock Financial Management to be completed within the next few weeks. Lehman also reduced its commercial real estate exposure by 18 percent in the third quarter to $32.6 billion from $39.8 billion.