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.

EMAIL  |   PRINT  |   SHARE  |   RSS
 
google my aol my msn my yahoo! netvibes
Paste this link into your favorite RSS desktop reader
See all CNNMoney.com RSS FEEDS (close)
By David Ellis, CNNMoney.com staff writer

james_cayne.03.jpg
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. To top of page

Features
They're hiring!These Fortune 100 employers have at least 350 openings each. What are they looking for in a new hire? More
If the Fortune 500 were a country...It would be the world's second-biggest economy. See how big companies' sales stack up against GDP over the past decade. More
Sponsored By:
10 of the most luxurious airline amenity kits When it comes to in-flight pampering, the amenity kits offered by these 10 airlines are the ultimate in luxury More
7 startups that want to improve your mental health From a text therapy platform to apps that push you reminders to breathe, these self-care startups offer help on a daily basis or in times of need. More
5 radical technologies that will change how you get to work From Uber's flying cars to the Hyperloop, these are some of the neatest transportation concepts in the works today. More

Sponsors