JPMorgan Likely To Spin Off
Bear Asset Management Ops >JPM
DOW JONES NEWSWIRES
May 16, 2008 12:28 p.m.
By Phil Craig
Of Financial News
JPMorgan Chase & Co. (JPM) is likely to spin off or
liquidate substantial portions of Bear Stearns Asset Management,
according to Chief Executive Jamie Dimon, who expects the acquisition of
Bear Stearns Cos. (BSC) to close within weeks.
Dimon told a UBS investor conference on Monday that he
expected the bank would close down "big parts of Bear's asset management
business", according to a Reuters report, which added that Dimon expects
charges of $300 million in the second quarter as a result of closing
down the divisions and maintaining Bear's brokerage business.
Underperforming funds will be shut down and liquidated,
while more successful vehicles could make the move to JP Morgan Asset
Management or be spun off "to their management teams", the report said.
At the conference, Dimon said that JPMorgan had
identified positions for 40% of Bear Stearns' total 14,000 staff. BSAM
had over 400 employees and $31 billion of assets under management at the
beginning of the year.
JPMorgan agreed to acquire Bear Stearns for $2 per
share after Bear Stearns suffered a liquidity crisis. The price has
since increased to $10 per share. JP Morgan expects the deal to close
around the weekend of June 1, according to Dimon.
-By Phil Craig of Financial News
(Financial News Online provides information about the
investment banking, fund management and securities industries.)
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