A Reuters news report quoted attorney Gregory Nespole, who represents the Police and Fire Retirement System of the City of Detroit, as saying the funds are pondering a challenge to the current plan for JPMorgan to buy 95 million newly issued Bear Stearns shares, or a 39.5% stake. The move is widely seen as giving JPMorgan a virtual lock on the proposed buyout, which requires majority shareholder approval, according to the report.
“At this juncture, based on the public record and based on the company’s stock price, which continues to trade at a premium … the $10-a-share figure remains inadequate,” said Nespole, of law firm Wolf Haldenstein Adler Freeman & Herz LLP, according to Reuters. JPMorgan has said it hopes to acquire the newly issued shares by April 8.
The Detroit fund last week sued Bear Stearns in Delaware Chancery Court over the proposed JPMorgan buyout seeking an injunction blocking the deal and damages for shareholders if it does close.
Nespole said the fund is coordinating efforts with another pension plan, the Wayne County Employees’ Retirement System, which has filed a separate lawsuit over the merger.