Free Web Novel“Chairman Dimon.”
Alan Schwartz stood up from his seat.
“It’s our first time seeing each other since the fundraiser. Good to see you.”
Jamie Dimon extended his hand toward him.
Alan Schwartz looked at it for a moment before shaking it.
“I heard there was good news. Congratulations. You’ve managed to put out the immediate fire.”
“I suppose that means Washington has taken this matter seriously as well.”
“Now, now. Let’s not stand around talking. Please, both of you, take a seat first.”
I naturally led the two of them to the table.
I sat in the seat of honor, while Jamie Dimon and Alan Schwartz sat facing each other.
“The reason I called Chairman Jamie here today is to throw you a lifeline, Alan.”
“A lifeline... now, of all times?”
Alan Schwartz’s reaction wasn’t particularly favorable.
Look at that?
I raised an eyebrow and looked at Alan.
“Alan, we’re doing business right now. Let’s put personal feelings aside and have a constructive conversation. Or do you have another option?”
Other than JPMorgan Chase, there was no alternative willing to acquire Bear Stearns.
China? The Chinese government would never intervene.
Saudi Arabia? Was there any reason for the Saudi government to acquire Bear Stearns under the current circumstances?
Then what about American banks? They were all too busy trying to figure out the extent of their exposure to various subprime mortgage products.
JPMorgan had only been able to breathe because they had transferred their subsidiary to us during the last crisis. Otherwise, JPMorgan Chase wouldn’t even have had the luxury of sitting here.
“Think about it carefully. Who in the world is going to take on a bomb called Bear Stearns right now?”
Alan Schwartz was unable to answer.
Resting my chin on my hand, I looked at the two men and smiled.
“Now begin negotiations. I’ll just mediate from time to time.”
Jamie Dimon spoke first.
“For us, acquiring Bear Stearns is practically a gamble. Yet there’s only one reason we’re willing to do it. Bear Stearns going bankrupt would do absolutely no good for Wall Street. I’ve devoted my entire life to Wall Street, so don’t think too badly of me.”
After his introduction, Jamie Dimon got to the real terms.
“Considering Bear Stearns’ current situation, I think one dollar per share is a fair price. What do you think?”
Alan Schwartz’s expression immediately froze.
“That’s absurd. At that price, it’s no different from giving Bear Stearns away for free.”
“To be blunt, I don’t even think it’s worth one dollar. We sold our subsidiary to Dreamhigh for one dollar as well, despite its liabilities being much smaller than Bear Stearns’.”
“But... there’s a huge difference in assets, isn’t there?”
“Exactly. That’s why I’m offering one dollar per share. Otherwise, I really would’ve offered just one dollar.”
“Stop saying such nonsense. I’ll never sell at that price.”
Alan Schwartz’s face reddened with anger.
I reached out and stopped him.
“Both of you, let’s discuss this calmly. There’s no reason to get so heated. Jamie, could you explain the basis for the one-dollar price in more detail?”
Jamie Dimon nodded and pulled out a stack of documents.
Pushing them forward, he began explaining.
“We analyzed the scale of Bear Stearns’ bad assets and its potential risks. Losses related to subprime mortgages are far larger than expected, and there’s a strong possibility they’ll continue to increase. And...”
Jamie Dimon paused briefly before continuing.
“Bear Stearns’ reputation has been severely damaged by this incident. The customer exodus due to those risks is already at a serious level.”
Alan Schwartz shook his head.
“That’s far too pessimistic. We’re a company with ninety-three years of history and expertise. If we can just get through this crisis...”
“That’s the problem. You can’t get through it. Am I wrong, Alan?”
“......”
“Then tell me. What price do you think is appropriate?”
After thinking for a moment, Alan answered.
“At least ten dollars per share.”
Jamie Dimon raised his eyebrows.
“Ten dollars? Are you that disconnected from reality? Wall Street itself is in crisis right now. Acquiring Bear Stearns means taking on enormous risk, and you’re talking about ten dollars? Ha, you’ve lost your mind!”
Before emotions escalated further, I stepped in.
“Both of you make valid points. But now is the time for compromise. Alan, what was Bear Stearns’ closing price today?”
Alan sighed. freewёbnoνel.com
“Twenty-one dollars.”
“It’ll probably rise a little next week.”
Since the bailout had been secured, Bear Stearns’ risks had been reduced.
Once the market opened, there was certainly room for a rebound.
Though expecting a huge increase would be unrealistic.
And what if more time passed?
“Then what do you think it’ll look like a month from now?”
Silence fell.
Everyone already knew.
Even if this support temporarily lifted Bear Stearns’ stock, the share price would continue to decline in the long run unless the risks were completely eliminated.
“Jamie.”
I addressed Jamie Dimon.
“Still, one dollar seems too low. Considering Bear Stearns’ brand value and talent, a higher price would be appropriate.”
After pondering for a moment, Jamie answered.
“I could consider four dollars. Anything above that is impossible.” freeweɓnøvel.com
Alan still looked dissatisfied.
“That’s still too low. It needs to be at least eight dollars if I’m going to persuade our employees and shareholders.”
The negotiations dragged on endlessly.
Neither side gave an inch.
Eventually, I stepped in with a compromise.
“Alan, let’s settle at four dollars.”
“Charlie! That’s...”
“Instead, if you successfully close the deal this time, I’ll give you a success fee. How about this? Excluding the four dollars per share that JPMorgan pays, you personally receive twenty-six dollars per share as a success fee for the shares you own.”
Silence filled the room once again.
It was quiet enough to hear Alan Schwartz swallowing nervously.
I turned to Jamie Dimon.
“Let’s make it four dollars per share. What do you think, Jamie?”
“I’ll try to persuade the board.”
“JPMorgan has nothing to lose. Your own money won’t even be used for this acquisition. You’ll be buying Bear Stearns with someone else’s money.”
The Federal Reserve and Treasury Department had no choice but to intervene in these acquisition negotiations.
Now that things had become more urgent, the Fed would have to lend to JPMorgan under even better terms and provide broader guarantees.
“Understood.”
Jamie Dimon accepted my proposal.
I nodded and turned to Alan.
“Alan.”
I spoke gently.
“The most important thing for Bear Stearns right now is survival. A merger with JPMorgan is the best option among all available choices.”
After thinking for a while, Alan let out a deep sigh.
“Understood. But Chairman Dimon, job security for our employees must be part of the negotiations.”
“Of course. Preventing key talent from leaving is part of the benefit. But executives won’t be included in that guarantee. They have to take responsibility.”
“......I understand that as well. That’s only natural.”
Finally, I was hearing something satisfactory.
Smiling, I said,
“Good. Four dollars per share and job security for employees as the basic terms. Work out the details. Reaching some level of agreement here will make the later negotiations much smoother.”
The two men continued negotiating the details.
Watching them, I stood up.
Slowly walking over to the window, I gazed out at New York’s nightscape and sank into thought.
How much time had passed?
Jamie Dimon and Alan Schwartz called out to me.
“Charlie. We’ve reached an agreement in principle.”
Turning around, I smiled.
“Excellent. Then it’s time to bring out the champagne I prepared. Looks like tonight is going to be a long night.”
At my words, Alan and Jamie forced bitter smiles.
They both knew this wasn’t the end, but the beginning of something new.
Bear Stearns would lower the curtain on its ninety-three-year history.
And JPMorgan would become the new center of Wall Street.
* * *
Federal Reserve Headquarters, Washington, D.C.
Late at night, two elderly gentlemen hurried into the building, avoiding the eyes of the guards.
David Rockefeller and Nace Meyer Rothschild.
Their faces were filled with worry and urgency.
[JPMorgan Chase in Acquisition Talks with Bear Stearns]
According to anonymous sources, JPMorgan Chase and Bear Stearns are engaged in secret merger negotiations. The talks are reportedly progressing rapidly due to Bear Stearns’ liquidity crisis and plunging stock price.
Although neither side has made any official comments, insiders say the negotiations have advanced considerably.
The two sides are reportedly divided on the share price, but are said to be nearing a final agreement.
If the merger is completed, the landscape of Wall Street is expected to change dramatically.
JPMorgan Chase is expected to absorb Bear Stearns’ prime brokerage and asset management divisions, further strengthening its market dominance.
Meanwhile, the Federal Reserve Board and the Treasury Department are also said to have participated in the negotiations.
Having already provided emergency bailout funds to prevent Bear Stearns from collapsing, authorities remain concerned about the impact a Bear Stearns bankruptcy would have on the entire financial system.
There is also speculation that the Federal Reserve and Treasury Department may actively support the merger by providing various benefits to JPMorgan Chase.
One Wall Street analyst commented, “With Bear Stearns unable to survive independently, a merger with JPMorgan may be the best possible option,” though he added that “the acquisition price and risk management will be the key issues.”
Official announcements from both companies are expected as early as this weekend or by early next week.
If the deal goes through, it will bring an end to the ninety-three-year history of Bear Stearns, founded in 1923.
At the same time, it will signal a new leap forward for JPMorgan Chase.
Ben Bernanke lowered the newspaper and furrowed his brow.
“So in the end, Bear Stearns will end up in JPMorgan’s hands.”
His thoughts were interrupted by his secretary.
“Chairman, your guests have arrived.”
“Show them in.”
A moment later, David Rockefeller and Nace Meyer Rothschild entered the office.
David spoke first.
“Ben, thank you for seeing us.”
“I have a good idea why you’re here. It’s because of JPMorgan and Bear Stearns, isn’t it?”
Nace interrupted.
“That’s right. If this deal goes through, the balance on Wall Street will be completely destroyed.”
Letting out a deep sigh, Ben Bernanke asked,
“What are your thoughts?”
David sighed deeply as well.
“JPMorgan’s influence will become too great. They’re one of the few places where our words carry little weight. We need another alternative.”
“For example?”
Nace answered.
“How about direct government intervention? Temporarily nationalize Bear Stearns, then later divide and sell it off to several banks.”
Bernanke shook his head.
“That isn’t realistic. It would be difficult to persuade Congress, and the market backlash would be severe.”
“Then what do you think?”
“How about the two of you joining forces and acquiring Bear Stearns yourselves?”
Heavy silence descended among the three men.
But no immediate answer came.
Inside, Bernanke let out a bitter groan.
If they had possessed the capacity, the two monsters sitting before him would have swallowed Bear Stearns long before anyone else.
After a long silence, David finally spoke.
“Ben, think carefully about whose help put you in that seat. And remember why we supported you in the first place.”
Bernanke flinched at the icy glare in David’s eyes.
