Sept. 14 (Bloomberg) -- Barclays Plc, the U.K.'s third- biggest bank, pulled out of talks to buy Lehman Brothers Holdings Inc. because it could not agree on terms to ring fence troubled assets at the U.S. investment bank.

Barclays dropped out of discussions to buy all or parts of New York-based Lehman because it could not secure guarantees from the U.S. government or agree on terms to mitigate potential losses in the firm's investment banking division, a London-based spokesman for Barclays said in a telephone interview today.

To contact the reporter on this story: Ben Livesey in London blivesey@bloomberg.net

Last Updated: September 14, 2008 13:11 EDT