September 15, 2008
Bank of America Will Acquire Merrill Lynch
Bank of America Corporation announced it has agreed to acquire Merrill Lynch & Co., Inc. in a $50 billion all-stock transaction. Under terms of the transaction, Bank of America would exchange .8595 shares of Bank of America common stock for each Merrill Lynch common share. The price is 1.8 times stated tangible book value. The transaction is expected to close in the first quarter of 2009. It has been approved by directors of both companies and is subject to shareholder votes at both companies.
Under the agreement, three directors of Merrill Lynch will join the Bank of America Board of Directors.
By adding Merrill Lynch’s more than 16,000 financial advisers, Bank of America would have the largest brokerage in the world with more than 20,000 advisers and $2.5 trillion in client assets. After the acquisition, Bank of America would be the number one underwriter of global high yield debt, the third largest underwriter of global equity and the ninth largest adviser on global mergers and acquisitions based on pro forma first half of 2008 results.
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