WASHINGTON (Reuters) - U.S. Treasury Secretary Henry Paulson said on Sunday he was pleased with the deal for J.P. Morgan Chase & Co. to buy Bear Stearns and with the Federal Reserve’s latest actions to enhance market stability.
Paulson, who was involved in the merger talks over the weekend, said in a statement: “Last Friday, I said that market participants are addressing challenges and I am pleased with recent developments. I appreciate the additional actions taken this evening by the Federal Reserve to enhance the stability, liquidity and orderliness of our markets.”
J.P. Morgan Chase said on Sunday it would buy stricken rival Bear Stearns for just $2 a share in an all-stock deal valuing the fifth largest investment bank at about $236 million, a fraction of its value last week.
Under the deal, the Federal Reserve will provide special financing and has agreed to fund up to $30 billion of Bear Stearns’ less liquid assets.
Reporting by David Lawder; Editing by Tomasz Janowski