Browse by Tags

• Good will on Wall Street

  Posted Mar 24 2008, 10:48 AM by Matt Koppenheffer
  Filed under: CAPS, Bear Stearns, JPMorgan
  Rating:

  After the shocking announcement last week that JPMorgan was buying beaten-down Bears Stearns for $2 per share, the bank conceded on Monday to raise the buyout price to $10 per share. Call it the spirit of Easter, or just that warm feeling from the beginning of spring, but the amended offer strikes me an awful lot like a gift from JPMorgan.
  
  Not everybody agrees with me though. Right now the field is split between those that think that Bear is worth substantially more than the original $2 deal, and those that think that the original $2 was a gift itself. For Bear Stearns' shareholders, the $10 per share is probably cold comfort anyway -- the price represents a 66% cut from the stock's price the Friday before the original $2 deal was announced, and a nearly 95% drop from its peak price of around $170.   Read More...

  Discuss ( 12 comments) 2,780 Views Digg this | Email this | Link to this

• Bear Stearns got bailed out?

  Posted Mar 19 2008, 12:07 AM by Matt Koppenheffer
  Filed under: CAPS, Bear Stearns, JPMorgan
  Rating:

  If Bear Stearns got a bailout this week, then it's sure news to the company's shareholders. The price that JPMorgan is expected to pay is around 1% of the company's value last year and in the range of 5% of what it was fetching on Friday when the original plan was announced for JPMorgan to loan Fed money to Bear.
  
  So who did get bailed out here? On the top of my list are Bear's creditors. At the end of Bear's most recent fiscal year it had $11.6 billion in unsecured short term debt and another $68.5 of longer term debt on its books -- and that's not to mention the hundreds of billions of other liabilities that the company had. If the super-duo of JPMorgan and the Fed hadn't swooped in those creditors are likely working with bankruptcy courts to sort out what they could recover.   Read More...

  Discuss ( 59 comments) 9,738 Views Digg this | Email this | Link to this

• Another one bites the dust

  Posted Jan 10 2008, 01:18 AM by Matt Koppenheffer
  Filed under: Investment Banking, CAPS, Bear Stearns
  Rating:

  The turbulence at the top on Wall Street continues. Bear Stearns will be sporting a new CEO now that Jimmy Cayne has announced that he is stepping down from the position. Cayne is now the third major Wall Street firm with a new chief, following the shake-ups at Merrill Lynch and Citigroup.
  
  It doesn't come as all that much of a surprise that Bear would make a change -- along with Merrill and Citi, the firm and its stock have been among the worst hit by the recent market turbulence. Unlike some of its other competitors, though, underperformance at Bear wasn't as localized to the debt markets, suggesting that there may be some bigger underlying problems   Read More...

  Discuss (no comments) 1,708 Views Digg this | Email this | Link to this