Old Mutual, tycoon may be hit hard by Bear share drop

BOSTON (Reuters) - The U.S. unit of Old Mutual Plc and British entrepreneur Joseph Lewis appear to be the hardest hit among Bear Stearns investors after its stock tumbled 84 percent on Monday, with nearly $1 billion wiped out from each of their stakes, according to Reuters data.

Barrow, Hanley, Mewhinney & Strauss Inc, the U.S. subsidiary of London-listed insurer and asset manager Old Mutual, was the biggest shareholder of Bear Stearns Cos Inc, owning about 11.5 million shares, or 9.7 percent, at the end of 2007, according to Reuters Knowledge.

The shares were worth about $1.01 billion when Bear was trading at $88.25 at the end of December, but valued at just $55.3 million on Monday.

Barrow, Hanley declined to comment on their holdings.

Bear shares have plunged in the past two trading sessions as the investment bank faced a capital squeeze, and agreed on Sunday to be bought by JPMorgan Chase & Co for $2 per share.

Reclusive billionaire Lewis bought a 7 percent stake in Bear in August and September last year, and then raised it in December. As of December 24, Lewis owned 11.05 million Bear shares, or 9.4 percent, valued at $981 million. On Monday, they were worth $53.2 million.

On Monday, Lewis, the septuagenarian British billionaire currency trader, called the takeover offer "derisory," according to CNBC television. A spokesman for Lewis confirmed the comments.

"It's derisory, in terms of being too low. A deal will get done with JPMorgan, but I think there's some pushback on $2 being the correct valuation," Lewis said through the spokesman.

Bear's former chief executive, James Cayne, was the third biggest shareholder, owning 6.3 million shares, or 5.34 percent, as of mid-February. The stock, worth nearly $500 million then, sank to just $30.3 million on Monday.

Star stock picker Bill Miller's Legg Mason Capital Management Inc was the fourth-biggest holder, owning 5.7 million shares, or 4.85 percent, at the end of December. Legg Mason Inc's flagship Value Trust fund, run by Miller, owned $203 million worth of Bear shares at end-December. They were worth $11 million on Monday.

Legg Mason declined comment on its Bear holdings. Cayne was not available for comment.

Bear Stearns stock closed down $26.04 to $4.81 on the New York Stock Exchange on Monday.

(Reporting by Muralikumar Anantharaman; editing by Jeffrey Benkoe)