Bear Stearns' Cayne sells over $60M in stock
Chairman dumps 5.6 million shares - his entire stake in the investment bank - a day after JPMorgan quintuples its bid.
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| Bear Stearns Chairman James Cayne shed his entire stake in the investment bank for just over $61 million. |
NEW YORK (CNNMoney.com) -- Just a day after JPMorgan Chase quintupled its bid for Bear Stearns, James Cayne, the chairman of the troubled investment bank, dumped his entire stake in the firm, selling more than $60 million worth of company stock he owned.
Cayne sold over 5.61 million shares of company stock Tuesday at $10.82 a share, according to a company filing with the Securities and Exchange Commission on Thursday.
The filing also revealed that his spouse sold an additional 45,669 shares, worth close to $500,000.
Calls seeking comment from Bear Stearns were not immediately returned. An attempt to reach Cayne's residence was not successful.
Bear Stearns (BSC, Fortune 500) shares closed at $11.23 apiece Thursday on the New York Stock Exchange, but tumbled over 5 percent in after-hours trading on the news.
Nearly two weeks ago, JPMorgan Chase (JPM, Fortune 500) announced it would scoop up Bear Stearns for a mere fraction of what it was once worth - $2 a share - after it suffered a classic run on the bank.
Amid rumors questioning Bear Stearns' financial health, Bear Stearns turned to the Fed, which asked JPMorgan to funnel funds to the embattled investment bank that the government would provide. Two days later, with the government fearing that Bear Stearns' unraveling would send widespread panic through the financial markets, JPMorgan agreed to purchase Bear Stearns.
Bear Stearns employees, which own about a third of the company, and other shareholders, expressed outrage at the terms, prompting JPMorgan to raise its bid for the investment bank to $10 a share earlier this week.
Cayne, the company's second largest shareholder behind billionaire and vocal opponent to the deal Joseph Lewis, lost an estimated $477.8 million on JPMorgan's initial offer, based on his holdings at the start of 2008. At the time, Bear Stearns stock was trading at $88.35.
Cayne stepped down in January as chief executive amid questions about his ability to lead the firm. He was reportedly out of the office when two of the company's hedge funds that were heavily invested in mortgage-backed securities collapsed, in what would herald the beginning of the ongoing credit crisis. 
