Times Online – Department heads from JPMorgan Chase yesterday began redundancy talks with their counterparts at Bear Stearns after securing a rescue deal late on Sunday evening to buy the bank for 6 per cent of its value last week.
While JPMorgan Chase refused to comment yesterday, it is thought that the American bank may be considering making half of the 14,000 Bear staff redundant.
JPMorgan Chase is expecting the deal to cost $6 billion (£3 billion) in expenses, from severance and retention to waves of litigation and asset writedowns. That comes after $30 billion of Bear’s bonds were underwritten by the US Federal Reserve.
Shares in Bear Stearns, which was acquired by JPMorgan Chase for about $240 million — representing a 94 per cent discount to Friday’s closing price, collapsed 84 per cent to $4.81, still above the $2 per share offer price. The deal was unanimously recommended by the Bear board but still requires shareholder approval.
