Premiership Owner Joe Lewis Loses Big on Bear Stearns Bust

One of the biggest casualties of the Bear Stearns bust this weekend is Joseph C. Lewis, owner of such big name football clubs as Tottenham Hotspur F.C. and SK Slavia Praha.

On September 10, 2007, he was in the news for paying $860.4 million in an all-cash purchase of a 7 percent stake in Bear Stearns that made him the brokerage firm's largest shareholder.  About $800 million of that was lost on March 16, 2008 when Bear Stearns was purchased in a straight stock swap with JP Morgan Chase in which JP Morgan paid the equivalent of $2.00 a share for Bear Stearns.

Lewis was listed as the 16th richest British person in Sunday Times Rich List 2007.

The Federal Reserve, which cut the discount rate in a coordinated move with its announced backing of the deal Sunday evening, is taking the extraordinary step of providing special financing in connection with this transaction.

The Fed has agreed to provide financing of up to $30 billion of less-liquid assets held by Bear Stearns (BSC). Roughly $20 billion of that funding will back mortgage securities.

J.P. Morgan (JPM) will exchange 0.05473 of a share of common stock for one share of Bear Stearns. Both boards have approved the transaction.

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Alistair Prescott, Gambling911.com

Originally published March 17, 2008 10:37 am EST