The stock hit $159 last year, started the year at $85, the week at $69.75 but closed at $30. Apparently, the situation was worsening.

According to CNN:

The deal values Bear Stearns at $236 million, or just $2 a share - shares had closed at $30 on Friday, down 47% that day.

Chief Executive Alan Schwartz - who took over as CEO in early January from longtime chief Jimmy Cayne - appeared on television on Wednesday afternoon to reassure the markets that the firm was stable.

But by Thursday night, Bear was in a severe crunch. Some firms that trade with it effectively stopped offering it credit because they feared that Bear was running short of short-term funding, or liquidity.

The US Federal Reserve will inject $30B to bolster its assets, but JP Morgan Chase will assume its positions. Paul Kedrosky points out that the company’s prime real estate holdings in Manhattan might be offering the buyer a margin of safety even in a worse case scenario.

See more coverage of this deal on WSJ and NYT.

Related:

- 1997: 1998: Federal Reserve and Banks Step in to Save Long Term Management Debacle, click here.