Get Your Popcorn Ready: JP Morgan To Acquire Bear Stearns For $2 A Share In Stock

March 16, 2008 at 10:20 pm  ·  Category: Federal Reserve, Market Commentary, Stocks

JP Morgan (JPM) is going to acquire Bear Stearns (BSC) for $2 a share in stock.  The Fed is also somehow involved providing “special financing” (JPM Press Release, Fed Press Release).

A lot of the talk this weekend was on the price tag Bear might fetch in any deal.  Having closed around $30 on Friday, the estimates I read were between $20-$40.  This is a very low price tag and suggests Bear has a lot of bombs on its balance sheet and would likely go under without this deal.

All the financial blogs are abuzz with this news.

Markets are selling off overseas.

I think we’re going to get a gap down open and a spike in the VIX.  I think this is a buying opportunity (for a trade).

Posted by Greg Feirman  ·  Trackback URL  ·  Link
 

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