Bear Stearns Announces Closing of $1.1 Billion for Merchant Banking Fund.

Business Editors

NEW YORK--(BUSINESS WIRE)--August 1, 2000

Bear, Stearns & Co. Inc. announced today that it held a closing yesterday on approximately $1.1 billion for the firm's first institutional merchant banking fund which initially targeted $1.0 billion, Bear Stearns Merchant Banking Partners II, L.P. and affiliated entities ("MBP II").

Commenting on the closing, president and chief executive officer James E. Cayne said, "This is an important milestone for our rapidly growing merchant banking franchise, which is one of the key businesses within the firm's overall expansion effort. We are especially pleased by the diversity of the fund's investors and the very strong commitment of funds from Bear Stearns employees." Bear Stearns has committed $500 million for itself and its employees and will be the largest investor in MBP II.

Bear Stearns Merchant Banking, comprised of a dedicated team of 18 professionals, the eight most senior of whom have over 120 years of combined relevant industry experience, invests private equity capital in compelling leveraged buyout, recapitalization and growth capital opportunities. Merchant Banking leverages Bear Stearns' proprietary network of client and professional relationships, in-depth industry knowledge and capital markets expertise to source, structure and nurture private equity investments.

Bear Stearns directly capitalized Merchant Banking's first portfolio of investments, Bear Stearns Merchant Banking Portfolio I, and invested $187.4 million in 18 companies. Since January 1, 2000, Bear Stearns Merchant Banking has been investing for the benefit of MBP II and has committed $246.8 million to seven portfolio companies and has funded $83.5 million of these commitments. Among these is Merchant Banking's recently announced $3.0 billion leveraged buyout transaction of Johns Manville Corporation.

Founded in 1923, Bear, Stearns & Co. Inc. is a leading worldwide investment banking and securities trading and brokerage firm, and the major subsidiary of The Bear Stearns Companies Inc. (NYSE:BSC). With approximately $24.6 billion in total capital, Bear Stearns serves governments, corporations, institutions and individuals worldwide. The company's business includes corporate finance and mergers and acquisitions, institutional equities and fixed income sales, trading and research, private client services, derivatives, foreign exchange and futures sales and trading, asset management and custody services. Through Bear, Stearns Securities Corp., it offers global clearing services to broker dealers, prime broker clients and other professional traders, including securities lending. Headquartered in New York City, the company has more than 10,500 employees located in domestic offices in Atlanta, Boston, Chicago, Dallas, Los Angeles, San Francisco and San Juan; and an international presence in Beijing, Buenos Aires, Dublin, Hong Kong, London, Lugano, Sao Paulo, Shanghai, Singapore and Tokyo. For additional information about Bear Stearns, please visit our Web site at http://www.bearstearns.com.