JPMorgan is acquiring Bear Stearns at a huge discount of $2 pershare. On Friday the stock closed at $30 per share.
The Fed's fingerprints were unapologetically all over thetransaction; it is rare for the monetary authority to step into aprivate market transaction. However, given Bear Stearns' reach intothe capital markets and its size--one of the largest brokers andunderwriters in the financial markets--government involvement wasall but expected.
As part of the deal, the Fed has promised to provide $30 billionto JPMorgan to finance the illiquid assets held by Bear Stearns.The Fed also took two other key steps on Sunday to stabilizemarkets in what was the first weekend emergency action in more than30 years.
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Erika Morphy
Erika Morphy has been writing about commercial real estate at GlobeSt.com for more than ten years, covering the capital markets, the Mid-Atlantic region and national topics. She's a nerd so favorite examples of the former include accounting standards, Basel III and what Congress is brewing.
