To me it appears that it is more in line with an asset sale rather than a statutory merger due to the fact that Bear Stearns will still seemingly exist at the end of the transaction, though be controlled by JP Morgan.
Well, that being said it definitely IS an asset sale. It is simply resulting in a de facto merger of sorts since Bear will eventually dissolve.
However, because of the principles of independent statutory significance, this type of deal screams asset sale to me.
Basically, by making it an asset sale rather than a straight merger, JPMorgan prevents their shareholders from getting a vote on the deal.
According to the plan of merger, Bear will merge with a JPM "merger sub" which will be dissolved and Bear will survive as a "surviving company."
However, under clause 1.1(b): Parent (JPM) may at any time change the method of effecting the combination
(including by providing for the merger of Company (BSC) with and into Parent) if and to the extent requested by Parent;
So, it is not really an asset sale per se. It is structured as a merger that will go through an intermediate restructuring to crfeate a sub.
Hope that helps
February 10th, 2010 at 4:05 am
According to the plan of merger, Bear will merge with a JPM "merger sub" which will be dissolved and Bear will survive as a "surviving company."
However, under clause 1.1(b): Parent (JPM) may at any time change the method of effecting the combination
(including by providing for the merger of Company (BSC) with and into Parent) if and to the extent requested by Parent;
So, it is not really an asset sale per se. It is structured as a merger that will go through an intermediate restructuring to crfeate a sub.
Hope that helps
References :
http://files.shareholder.com/downloads/ONE/289885431×0x182539/3587fb60-3b11-4435-bb4c-8d1af1482b23/Merger%20Agreement%203.20.08.pdf