Stock Market

JP Morgan Chase is offering to buy troubled investment bank Bear Stearns (BSC Message Board) for between $15 and $20 a share, CNBC has learned.

Jin Lee / ASSOCIATED PRESS Bear Stearns

Bear’s board is currently meeting to discuss the proposal. A deal in principle could be announced Sunday night, although the agreement would still need shareholder approval.

Here’s what makes this a tricky situation: without shareholder approval, there is no real deal, so other banks and clients may be reluctant to deal with Bear on Monday unless it’s part of a well capitalized JP Morgan.

Because of this, most executives inside Bear believe the Federal Reserve and Treasury will play some role in making sure there is a backstop if the shareholder approval isnt reached.

Of course, the deal itself could fall apart at the last minute, which would mean Bear would have to find another buyer, possibly JC Flowers.

An offer of $20 or less would be considered very low for Bear. As one senior Bear executive–who like most of the senior team is paid and continues to hold Bear stock–puts it: “based on the information i’m getting, lets just say I wont be retiring early.”

(http://www.cnbc.com/id/23658905)