Freeport-McMoRan Exploration
freeport mcmoran richard adkerson
Freeport McMoRan CEO Richard Adkerson

In a year that highlighted the conflicts of interest in Wall Street deals, Freeport's $9 billion bid to buy a former subsidiary and a related company took the prize. More than half of the directors of McMoRan (MMR) also sit on the board ofFreeport (FCX, Fortune 500). The chairman of Freeport, Jim Bob Moffett, is also the CEO of McMoRan. So perhaps it's not surprising that Freeport agreed to pay 74% more for McMoRan than what investors were previously saying the company was worth.

Freeport's own board members stand to gain. And that would all be alright if investors thought the deal was a good one. They don't. On the conference call to announce the deal, Blackrock portfolio manager Evy Hambro said, "Congratulations on making one of the worst teleconferences I've ever heard to justify a deal." He didn't think the deal was so hot either.

  @FortuneMagazine - Last updated December 28 2012 03:45 PM ET
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