New York, March 16, 2008 — JPMorgan Chase & Co. (NYSE: JPM) announced it is acquiring The Bear Stearns Companies Inc. (NYSE: BSC). The Boards of Directors of both companies have unanimously approved the transaction.
The transaction will be a stock-for-stock exchange. JPMorgan Chase will exchange 0.05473 shares of JPMorgan Chase common stock per one share of Bear Stearns stock. Based on the closing price of March 15, 2008, the transaction would have a value of approximately $2 per share.
So what does this mean for the agreement between CITIC Securities and Bear Stearns to invest US$1 billion in each another? Last we heard, they were renegotiating on the size of these stakes to reflect the downturn in their respective stock prices.