Bear Stearns Summer Analysts - Sold to another bank?
Say Bear Stearns gets sold to another bank (maybe a big commercial bank like BoA or Wachovia), what will happen to the summer analysts that signed on with Bear for 2008? Will they all be screwed? Has something like this happened before? DLJ-->CSFB, Smith Barney-->Citi. What happened in those cases to the SA's?
I'm wondering the exact same thing....
Back then they did not have large formal summer analyst/associate programs or training. It was a different system, FT offers were not given out at the end of the summer, etc.
All you can do, IMO, is just go with the flow. I would expect that most of the 2008 FT & SA positions would be effected in some way. Worse case, they may decide to do an overall, emergency freeze of incoming hires. The merged/buyout companies need to have a plan in place that would take time to prepare, at least 90 days or so, to determine redundant positions.
Not much you can really do. Hell, the companies don't even know what they are going to do, if anything.
what about Bear Stearns SA hires in structured products?
In the SA boat, I just say... hold on because I feel like this will be the beginning of a wild ride.
I wouldn't worry too much about it. Honestly, the summer is rapidly approaching and, as mentioned above, it takes time to process significant changes. If BSC does end up bought, I doubt the buyer will be looking to significantly alter the business. You should make it through your summer just fine.
The full time people, I think you are in a much riskier position. However, there isn't much you can do and your best bet may just be to ride it out at this point.
CompBanker is right. Any announced transaction (even today, for example) would not effect any hires for the summer (but may affect full time hiring towards the end, not a good chance, though). It takes a while for financial institutions to fully integrate, even two complimentary business lines. They'll focus first on cutting heads at the senior level to see who's redundant, and go from there on downwards to figure out what the analyst class should be. In addition, since Bear tends to focus on a smaller market than alot of the bigger banks, there may be a much smaller overlap in client base than you think, and they may choose to keep them somewhat separate.
What about for general S&T hires?
Who is most likely to buy Bear Stearns at this point provided the bail out by JP Morgan and the Fed doesn't work out.
Guys, you are asking questions that nobody on here can answer or even pretend to answer. On top of that, it's completely out of your control (short of looking for another job and reneging on any BS offer, which is extreme).
Everyone is assuming Bear will get bought, and the situation doesn't look too great right now. But keep in mind that mergers between financial institutions are very hard to pull off. At the end of the day there is no real cost basis for a financial firm, there are no physical assets - it's all human capital. And particularly in investment banking, where egos run high, a culture clash is inevitable. How do you keep all the star bankers at the target from running for the hills? Lock everybody up into outrageous 3 year contracts (like CS and UBS did with DLJ right before the market tanked)? It's just not feasible to guarantee anyone anything in a outright recession (not to mention no one is incentivized to outperform if they are locked in and they can blame everything on market environment).
And while certain mergers, like Lazard and Goldsmith, can work because there's no overlap, you can be gaurunteed that there will be a giant culture clash between Bear (who has a distinct culture to begin with) and anyone who wants to buy them.
to GameTheory: can you be more specific in what you mean by "distinct culture" wrt Bear? thanks for the help.
There are no answers now. But I bet Cayne is not on the course today.
If interested, the BS website has today's conference call you can replay-code is given-under press releases. Also 17 March, Monday is the day BS announces first quater.
Just think of all those holding stock that was given as bounus. And circa 60% held by funds.
Not good at all. Next week will be bloody for all financials, I'd suspect.
I read that he was at a bridge tournament on Friday and reluctantly dialed in for an emergency conference call with Bear's board. Ha ha.
As GameTheory says, mergers between financial institutions are very hard to pull off.
But to answer indian-banker's question, the most likely buyers are JPMorgan (advisor to BS) or Barclays Capital (large UK clearing bank, wants to expand in the US). Neither firm has been affected by sub-prime as much as their competitors.
Another possibility is Citic Securities, BS's strategic partner in China.
A Bear buyout's effects on SA (Originally Posted: 03/16/2008)
I'm expecting to hear back from Bear's energy trading group, Bear Energy, who have actually been making money. I'd like to think they would be less impacted by a takeover or at least held together should they alone be sold off.
I know nobody really knows for sure what will happen with Bear, but does anyone have any thoughts about what a buyout would mean for summer positions?
Pretty sure Monty09 works for BE, so I'm sure he'd be better informed. That being said, I read a few articles indicating that Bear was planning to sell off BE and some other assets to raise funds. I would assume the group will stay together throughout w/e acqusition ensues.
Dealbreaker seems to think theyre having problems too and may be liquidating some assets. Just rumors at this point though.
WSJ is reporting that JP Morgan will likely buy it, valuing at ~$20 share, before the Asian markets open.
On Friday, BE got taken off ICE and our shop and many other shops were given notice to no longer do business with BE. I believe based on the conference call today that BE should be active on ICE tommorow.
BE is a good shop, they ain't going anywhere, next to the prime brokerage, another major appeal to JPM to buy BSC was BE.
Thanks for the info...In JPM's press release it did mention expamding its energy platform. If ya get any new info or can confirm being active later, please let me know.
shoot any q's my way.
the news reports have been hit or miss... some true nothings not so much...
Wacc Attack - This thread has some good discussion of Bear's culture, particularly the posts by BigBadBanker and GenghisKhan.
http://www.wallstreetoasis.com/node/12017
So JPM is hugging bear, what will happen to bear's employees and interns? (Originally Posted: 03/16/2008)
Anybody can comment on this? Seems like JPM is only interested in prime brokerage business, what about bear's ibd, trading and back office people? are people gonna get fired soon? what about interns and on-going interviews? what about their london and hong kong's office? Anybody???
The CEOs of the respective companies don't even know, how the hell are people on an internet forum going to know... stop asking this same question over and over
don't be a jackass, nyc123. if you had some skin in this you would be just as curious, and wouldn't be so quick to criticize. it's natural for bear folks to be freaking out and at least wanting to hear the perspective of others. if you're so annoyed by these threads then don't read them and keep your comments to yourself; plenty of other material on this site to give your "insight" on.
this is actually quite interesting that this is happening to bear. I talked on the phone with a recruiters and he was just like, telling me how he's not convinced and stuff and for me to try again next year... i guess i won't be now.
If JPM is interested only in it's prime brokerage business, then chances are they won't be able to take over Bear, or worst case scenario (IMO highly unlikely), Bear will be broken up into two respective divisions; brokerage and investment bank.
And it's simply not rational to worry about something you can't control.
Senior bankers will likely be more affected, at least at first, rather than junior bankers, simply because they are viewed as longer-term employees and are responsible for generating revenue.
The good news is that there is likely not all that much overlap with JPM because JPMorgan typically works with larger companies than Bear (gross generalization and not always true, but worth pointing out).
As far as summer internship offers, I would imagine they will either be converted to JPM offers or revoked. Not to freak anyone out, but from a logical standpoint those are the 2 main possibilities.
Again I would emphasize no one really knows, this is 100% pure speculation.
Just being real here, my friend... asking about this kind of thing does nobody any good because no one knows any real information... things said on this forum regarding this situation are 100% speculative and therefore don't make any sense to listen to from a rational standpoint... the only thing non-speculative is the news coming out that JPM is trying to purchase BSC for $20/share, even then, no one knows how the two will be merged
its $2 a share my friend.
They were talking about offering $20 when I made that post, unfortunately the closing price of $2 came in shortly thereafter, but yes, now its $2
They'll probably gut the company, fire a good 80% of its employees, and let the C levels cash in on their golden parachutes. The only group that wins in a merger/buyout is upper management, as always.
"We are lawyers! We sue people! Occasionally, we get aggressive and garnish wages, but WE DO NOT ABDUCT!" -Boston Legal-
while similar i don't think that the dlj/cs precedent is entirely fair. the amt of money paid for the people (~13bn) will likely be much higher than what people will pay for BS. further, there isn't the dramatic demand for talent to poach the people away like UBS was able to do from dlj/cs. ultimately, if you ride this out, the cost of acquiring the human capital may come close to the cost of simply poaching the talent with guarantees and then building and taking client relationships with BS client service work.
from the ibd side, there are still some groups at BS that are winning mandates, like TMT (CVC among others).
so the value is still there, the question is at what point do the negative messages from the trading businesses tarnish the value of the IBD game plan with clients.
Deal book had an article on potential buyers today and Barclays seemed like a reasonable candidate, at the right price.
From a future SA at Bear IBD, who would I wish bought out Bear if they need to be bought out. I am thinking a foreign bank so they keep the Bear name and culture in tact and keep it close to business as usual.
If Barclays buys out Bear, would the IBD stay in tact as well as the Bear name?
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