Bear Stearns could get higher JPMorgan bid: Barron's
NEW YORK (Reuters) - Bear Stearns Cos BSC.N could fetch a higher takeover bid from JPMorgan Chase & Co (JPM.N), and at $6 its shares constitute a "reasonable speculative bet" that one will be forthcoming, Barron's said in in March 24 edition.
On March 16, the stricken Bear agreed to a $236 million all-stock buyout by JPMorgan, valuing the company at about $2 per share. That value has since risen to about $2.52 per share because JPMorgan stock has since risen.
Bear shares closed Thursday at $6.39, a premium to the merger price, because some investors hope the company will find another buyer or JPMorgan will increase its offer.
The merger requires shareholder approval. Some investors, including Joseph Lewis, who has lost some $1 billion on his Bear investment, have said the terms could be better.
Barron's said a sweetened JPMorgan offer is more likely than an alternative bid. It said few financial companies have the capacity to take on Bear's obligations, or would want to upset federal regulators that blessed the transaction. It also said private equity firms lack the means to make counterbids.
In addition, the newspaper said JPMorgan included deterrents to potential bidders, including an option to buy Bear's glittering Manhattan headquarters for $1.1 billion.
Barron's said JPMorgan isn't commenting, but might raise the price to clinch the merger and quell critics. It said JPMorgan could easily pay $1 billion to $2 billion more for Bear, especially after netting $1.3 billion of cash last week from Visa Inc's (V.N) initial public offering.
(Reporting by Jonathan Stempel, editing by Richard Chang)
