Bear Stearns was racing Sunday afternoon to sell itself to JPMorgan Chase for more than $2 billion, according to people involved in the talks. Meanwhile, Bear Stearns, whose solvency is in question, was also making preparations to file for bankruptcy protection as a backup plan should a deal not be reached, these people said.
A deal for Bear Stearns would end the independence of one of Wall Street’s most storied firms and help halt a sweeping panic that set in at the end of last week, causing Bear Stearns’s stock to swoon 47 percent on Friday. If an agreement is not reached and Bear Stearns files for bankruptcy, it could cause an even deeper global scare over the fate of the financial system.
The talks, which are being overseen by the Federal Reserve and the Treasury Department because of their potential effect on financial markets, are being rushed in the hopes of reaching a deal before stock markets open in Asia at 8 p.m. Eastern time.
Bear Stearns’s chief executive, Alan D. Schwartz, and other top Bear executives huddled in all-day meetings at the firm’s Madison Avenue headquarters, trying desperately to persuade skeptical potential suitors that the firm was worth buying for a price that would likely represent a steep discount to its book value, considered the truest measure of the financial health of a banking institution.
http://www.nytimes.com/2008/03/16/business/16cnd-bear.html?ref=business
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