JPMorgan Raises Offer on Stearns

NEW YORK -- JPMorgan Chase increased its offer Monday for Bear Stearns to $10 per share from a bargain-basement price of $2 per share, hoping to assuage shareholders of the ailing investment bank.

Bear Stearns shares, which had already been trading above the initial offer price, more than doubled.

The move was aimed at diffusing a backlash among Bear Stearns shareholders who felt the original deal undervalued the 85-year-old institution. JPMorgan Chase chief executive Jamie Dimon spent most of the week trying to woo Bear Stearns employees, who collectively own about one-third of the company.

"We believe the amended terms are fair to all sides and reflect the value and risks of the Bear Stearns franchise," he said in a statement, "and bring more certainty for our respective shareholders, clients, and the marketplace."

The new deal values Bear Stearns at about $1.19 billion -- still a fraction of what the company was worth before its sudden near-collapse earlier this month.