So… I guess the whole JPMorgan Chase buying Bear Stearns for just $236 million was just a test.

JPMorgan Chase & Co on Monday raised its takeover offer for Bear Stearns Cos to about five times its original bid and struck a deal to buy nearly 40 percent of the bank, all but locking up the controversial acquisition.

Under the revised deal, JPMorgan will buy 95 million newly issued Bear Stearns shares, and Bear’s board agreed to vote in favor of the offer. With those shares, JPMorgan would own 39.5 percent of Bear Stearns and have secured the backing of Bear Chairman James Cayne, owner of a 3 percent stake in Bear.

“It looks like JPMorgan has this deal sewn up right now,” said John Augustine, chief investment strategist with Fifth Third Investment Advisors.

From the sound of things, I think they had it “all sewn up” last week, but someone must have come in and complained about something that would have soured the whole deal. Why else would they come back and decide to offer 5 times their original amount?

I think even Howie Mandel would say that, compared to a year ago (at $170.23 per share), $10 per share is still a very good deal.

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