Cayne Unloads Bear Stearns Stock
A WALL STREET JOURNAL ONLINE NEWS ROUNDUP
March 27, 2008 4:53 p.m.
Bear Stearns Cos. Chairman James E. Cayne reported selling $61.3 million of stock in the company, a move that came in the wake of J.P. Morgan Chase's recently revised deal to buy the Wall Street firm.
According to a filing with the Securities and Exchange Commission late Thursday, Mr. Cayne sold 5.66 million shares on Tuesday for $10.84 a share. Mr. Cayne didn't immediately return a call for comment, and a Bear Stearns spokesman said the company would have no comment on the filing.
Because the merger agreement with J.P. Morgan is an all-stock deal, its value changes with the price of J.P. Morgan stock. When the deal was announced, its value was put at $10, and now stands at about $9.32 a share. Bear Stearns's stock has consistently traded above the offer price and closed on Thursday at $11.23 a share.
Originally, J.P. Morgan had agreed to acquire Bear Stearns for $2 a share, but the market price never fell to that level, apparently on the belief -- later borne out -- that the deal wouldn't go through on those terms.
In January, Mr. Cayne relinquished his CEO post but remained as chairman. Mr. Cayne, who became the firm's chief in 1993, acquired a reputation for being a hands-off leader last year as the current credit crisis unfolded. His departure as CEO came as Bear Stearns shares hovered near a four-year low, reflecting investor concerns that the firm hadn't seen the worst of the fallout from the credit crunch.