JP Morgan Channels Donald Trump To Net $530,000,000
Many Bear Stearns stockholders are sick with thoughts of the JP Morgan buyout at a 2 dollar share price JP Morgan paid. The unreported shocker of the deal exposed here is how JP Morgan has acquired a high priced real estate marque the Bear Stearns Headquarters, for a relative pittance. The building is valued at roughly $1.1 billion while the total cost of the buyout was $236 million. Between employees, contact lists, ongoing revenue streams etc. Bear was probably worth more that $236 million just in goodwill. So the building was thrown in with debt as part of the deal.
Yes their is debt on the building, about $570 million, but there was also an alternative need for JP Morgan. JP Morgan is looking to move from their present building and the Bear Stearns Headquarters is far more appealing than their current address. Bears location near Grand Central Terminal does not hurt either.
JP Morgan will have to absorb the risk and poor decisions Bear Stearns has made, but once that is complete the upside will be dramatic. While J.P. Morgan had planned to move its investment-banking and trading operations to a building that is planned for the World Trade Center site, it will now move those operations to the Bear Stearns headquarters. However, J.P. Morgan will retain the right to build at the World Trade Center site.
These guys really have channelled “The Donald” for this deal. The walk in with $530,000,000 in equity on day one and retain building rights at the World Trade Center site. These kinds of commercial real estate plays would truly make “The Donald” proud.
While admittedly I may not have a billion dollar deal to direct you to in Napa Valley I do have several “off market” deals with seven figure upsides. Contact me at 707-254-9999 or email Mike@MikeBolen.com
