British billionaire Joseph Lewis, a magnate who controls more than 170 companies, has acquired a seven per cent stake in investment bank Bear Stearns Companies, becoming one of its largest shareholders.

Lewis, who runs Florida-based investment vehicle Tavistock Group, bought 8.1 million shares between August 6 and September 7, according to documents filed yesterday with the Securities and Exchange Commission.

That would make him the investment bank's largest shareholder, assuming no others holders have adjusted their stakes substantially of late.

The investment would trump Putnam Investment Management's six per cent stake and Bear Stearns Chief Executive Jimmy Cayne's 5.8 per cent interest.

According to the filing, the purchase price for the shares totalled US$860.4 million (€623.7) million. Lewis, a resident of the Bahamas, said he acquired the stake for investment purposes.

Bear Stearns shares have fallen about 30 per cent since the beginning of the year amid worries related to the crisis in the mortgage markets.

The fifth-largest U.S. investment bank was slammed after it disclosed earlier this summer that two hedge funds it managed were rendered all but worthless after wrong-way subprime mortgage bets.

Subprime mortgages are those made to people with shaky credit, and the fallout from rising defaults in the subprime market has shaken Wall Street this summer.

Future unclear

It was unclear if Lewis planned on expanding on his investment in Bear Stearns, a company which has been the subject of takeover speculation because of its recent troubles.

Executives with Tavistock and Bear Stearns did not immediately return telephone calls seeking comment.

The British-born billionaire operates Tavistock from both the Bahamas and Florida, and has offices in Argentina, China, Mexico and the European Union.

Tavistock also has interests in Jamaica, having partnered with Harmonisation Limited, a state company, to develop a luxury complex called Harmony Cove, in Trelawny.

Lewis' portfolio includes two English football clubs.

A biography in the London Times said he was born in that city's East End, and amassed a fortune from the foreign exchange markets.

He was listed as the 486th richest person by Forbes magazine.

Bear Stearns shares fell 15 cents to US$105.42, mirroring declines in the broader market.

- AP