The secretive British billionaire who bought a nearly 7 percent stake in Bear Stearns isn’t likely to use his newfound position to stir the pot at the troubled investment bank, The Post has learned.
Former currency trading superstar Joseph Lewis, whose roughly 8.1-million-share stake in Bear was disclosed Monday, is a personal friend of Bear Stearns Chief Executive James Cayne and has frequently played bridge with him, a source told The Post.
Also, Lewis has long had an account at the firm and executed trades using its trading desks.
According to chatter on Wall Street’s baffled trading desks, Lewis’ only other high-profile public investment occurred nearly 10 years ago, when he amassed a 30 percent stake in auction house Christie’s International.
One explanation for the billionaire’s investment is perhaps to energize Bear to take actions to stem the nearly 34 percent drop in its stock price this year.
Bear has sustained a number of lumps this summer as a result of the subprime mortgage mess.
The firm saw two hedge funds implode, leading to $1.6 billion in losses to investors, thanks to a series of bad bets on the subprime market.
Those missteps led this summer to the ouster of Co-President Warren Spector, who had been regarded as an heir apparent to the 73-year-old Cayne.
Anecdotally, Lewis has much in common with aspects of Bear Stearns’ unique culture, where school, social status – and some might say comportment – have long been rejected in favor of the single-minded pursuit of wealth.
Lewis is self-made, having come from modest roots in London’s East End, and has made his estimated $1.6 billion fortune in the high-stakes, no-holds-barred world of currency trading.
Lewis’ record of taking minority stakes in private companies via a series of offshore-registered entities would appear to indicate that the notoriously press-averse Bahamas resident is not likely to launch the type of proxy war common to shareholder activism.
The announcement of Lewis’ stake has begun to pay dividends – literally – for his funds, with the stock closing up another 14 cents yesterday to $107.64.
Prior to disclosing his stake, he was down about $5.7 million since he had initially built his position by selling put options (a bet the stock price would drop) when the stock was between $130 and $150.