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Bear Stearns Shares Fall 5% After Cayne Sells Stock

Bear Stearnsshares fell nearly 5 percent Friday after Chairman James Cayne, who was seen as opposing JPMorgan Chase's acquisition of the investment bank, sold his stock.

"It is symbolic that he's selling," said David Dreman, chief investment officer of Dreman Value Management, a New Jersey based fund manager that has over $18 billion under management. "It lessens the potential enormously for a long drawn out battle."

"I think he knows that they're not going to get much more," said Dreman, whose firm owns JPMorgan shares.

In a filing on Thursday, Cayne, who stepped down as chief executive of Bear in January after nearly 15 years at the helm, disclosed that he sold all of the 5.6 million Bear shares he directly held. His wife also sold all of her nearly 46,000 shares.

JPMorgan has offered about $10 per share in its acquisition of Bear Stearns

. That was increased from the original offer of $2 per share amid speculation that major shareholders would not accept the deal on those terms.

Cayne sold 5.66 million shares for exactly $10.84 a share for $61.3 million. However, it was not known if those shares were dumped into the open market or if Cayne sold them to another party.

A spokesman for Bear Stearns would not comment on the sale.

Shares of Bear Stearns have traded above the prices offered since the deal was announced as some investors felt a rival bid might be in the offing. There has also been speculation that Cayne might try and muster a competitive offer with Joseph Lewis, a billionaire financier who is Bear Stearns' second-largest shareholder.

Telephone calls to Lewis were not immediately returned.