From Staff Reports
Shares of Bear Stearns Cos. Inc. (BSC) fell 3% yesterday (Thursday) afternoon after a CNBC report downplayed any talks between the embattled investment bank and potential outside investors – one of whom is rumored to be Berkshire Hathaway Inc.'s (BRK.A, BRK.B) Warren Buffett. After the swing out of positive territory, the shares closed down 1.5% for the day.
"At present Bear is not holding talks about the sale of a stake to anyone," CNBC reporter David Faber said.
Bear Stearns shares fell as much as 3.4 percent immediately after the CNBC report before closing at $121.15, down 1.5%, or $1.85 per share, on the New York Stock Exchange.
Battered by the collapse of two hedge funds and a disruption in its fixed-income trading, Bear Stearns is seen as relatively weak when compared to other U.S. investment banks, Reuters reported. An outside investor is seen as way to bolster the company.
Bear Stearns shares jumped almost 7.5% Wednesday after the New York Times reported that the investment bank is in talks to sell a minority stake to investors, including Warren Buffett.
The firm is in "serious" talks with several outside investors and could sell as much as 20% of itself, the newspaper said, citing unidentified people briefed on the discussions. Other investors who have expressed an interest in investing in Bear Stearns include Bank of America Corp. (BAC), Wachovia Corp. (WB), and two China-based institutions, the Citic Group and China Construction Bank, the Times reported.
News and Related Story Links:
CNBC Downplays Bear Stearns Investor Talk.
- Money Morning News:
Warren Buffett and Berkshire Hathaway Rumored as Bear Stearns Investors.
Bear jumps on report bank may sell minority stake; Buffett, Bank of America, Wachovia, Chinese groups interested, N.Y. Times Reports.
U.K. Investor Lewis Has 7% Bear Sterns Stake.
Money Morning News:
Two Bear Stearns Hedge Funds Declare Bankruptcy, a Third Freezes Assets.
- Money Morning Analysis:
To Make a Small Fortune in Hedge Funds, Better Start With a Big One.
- Bloomberg News:
Bear Stearns May Attract Investment From Buffett, Chinese Banks.
Money Morning Investment Analysis:
Warren Buffett's Berkshire Hathaway is Riding the Rails Again.