Filed under: Management, Rants and raves, Scandals, JPMorgan Chase (JPM), Bear Stearns Cos (BSC)
It took about ten minutes in a special meeting of the shareholders to approve the sale, acquisition or bail-out of Bear Stearns (NYSE: BSC) to JPMorgan Chase (NYSE: JPM). You can call it what you will, but the illustrious company is coming to a dismal end.
There was not much to say at Thursdays short meeting, but in brief remarks to attendees, James Cayne, who was Bear’s chief executive when its problems took hold last summer, said “I have no anger, only regret,” The New York Times reported. “14,000 families were affected. I personally apologize. I feel an enormous amount of pain and management feels an enormous amount of pain.”
Pain and billions of dollars, to say the least. When the Federal Reserve, led by Ben Bernanke, arranged this shot-gun wedding, JPM was offering $2 per share for BSC and then upped the price to $10, prompting me to write JPMorgan’s $10 offer for Bear still too cheap!. In any event that was the price and that’s where it stands. Ten bucks for a company that was trading at $150 in the not too distant past. The last sixty bucks evaporated in one week!
It did not have to be this way, but alas — bad management, greed and too much negativity on Wall Street made it unsustainable when sustainability is the word of the day. I have been doing a series of stories on Warren Buffett’s ideas on investment and this one comes to mind: Serious Money: The page on Buffett Part V: Company Management.
So BSC will be no more and JPM will continue to prosper having far better management. Perhaps BSC should post signs to that effect in its offices, just like an unsuccessful business might after a change: UNDER NEW MANAGEMENT!
Sheldon Liber is the CEO of a small private investment company and the design and research principal for an architecture and planning firm. He writes Chasing Value and Serious Money columns. Disclosure: I am a shareholder in BSC.
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