NEW YORK (AP) - Bear Stearns and JPMorgan Chase & Co. were close to an
emergency buyout deal Sunday night aimed at averting further panic in the
financial markets, media reports said.
The Wall Street Journal reported JPMorgan would buy Bear Stearns for a per
share price that is likely to be "considerably less" than the $30 the stock
closed at Friday.
The Journal and the Financial Times both reported the sides were in a rush
to complete a deal before financial markets opened in Asia for Monday morning
trading, amid fears that a crisis of confidence could roil the system further.
The government, led by the Treasury Department and the Federal Reserve, was
reported to be closely monitoring the talks.
After days of denials that it had liquidity problems, Bear was forced into a
JPMorgan-led, government-backed bailout on Friday. The arrangement, the first of
its kind since the 1930s, resulted in Bear getting a 28-day loan from JPMorgan
with the government's guarantee that JPMorgan would not suffer any losses on the
deal.
Among the Wall Street investment banks, Bear Stearns was the most closely
exposed to the mortgage crisis. The collapse of two of its hedge funds last
summer was seen by many as one of the triggers of the current credit crisis.
"The Journal also reported that were a deal with JPMorgan to fall apart,
Bear could conceivably file for bankruptcy late Sunday before Asian financial
markets opened."
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