JPMorgan Chase announced today that it will acquire Bear Stearns for $2 a share today. On Friday, Bear Stearns’ stock price closed at $30.00 on Friday. This is already down close to half over its Thursday close. In addition, it is 81% down from its high for the last year of $159.36. The subprime mess claims its first blue chip victim.
Bear Stearns, a major investment banking, securities trading, and asset management company and a Wall Street institution was forced on Friday to accept a loan package from JPMorgan Chase and the US Federal Reserve System on Friday. This loan from the Fed represents the first time the Fed had bailed out a non-bank financial institution since the Great Depression.
The plot thickens.