CITIC to invoke MAC clause?

Back in October last year, Citic Securities announced it would buy up to 9.9% of Bear Stearns. This would have been a landmark deal but, given Bear's current troubles, it will be surprising if Citic doesn't bail.



From 10/23/2007 Washington Post

NEW YORK, Oct. 22 -- China's Citic Securities would acquire up to a 9.9 percent stake in Bear Stearns under a joint venture that marks the first time an entity controlled by the Beijing government has obtained a significant stake in a major Wall Street investment bank.



The two firms would invest about $1 billion in each other, sell financial products in China and start a Hong Kong-based joint venture offering financial services in other Asian markets.



"Citic invests in energy and other sectors, but this is a major step so far in investing in the financial services area," said Wenran Jiang, director of the China Institute at the University of Alberta in Canada. "The simple fact is that there is a lot of cash flowing around. The basic law when you have so much surplus capital is just to go diversify and look into the big guys overseas."