Will Bear Shareholders Kill the Deal?

Trading in Bear Stearns stock was heavy yesterday, and the stock closed at $5.91 per share, almost three times the price offered by JP Morgan Chase in the merger.  Both bondholders, who want the deal to go through, and stockholders, who hope a better deal is out there, were buying the shares.  Shareholders, many of whom are Bear Stearns employees (an estimated 30% of the shares are owned by employees), threaten to vote down the merger, but it appears unlikely that another bidder would risk the Fed's wrath and offer competition to the merger it brokered.  JP Morgan Chase has two valuable lock-up options, an option to buy the Bear Manhattan headquarters and an option to buy 19.9% of Bear stock at $2.  If the shareholders vote down the merger (the vote is expected by the end of May), Morgan could purchase the shares and may have enough stock to prevail at a second shareholders vote (which the merger agreement provides for).  NYTimes, It’s Bondholders vs. Shareholders in a Race to Buy Bear Stearns Stock; WSJ, Bear's Run-Up Sets the Stage
For Epic Clash.