Reports: Bank of America buys Merrill Lynch for $44B
Financial giant Merrill Lynch & Co. agreed late Sunday to sell itself to Bank of America Corp. for about $44 billion, according to reports late on Sunday.
The Los Angeles Times reported that Merrill will get $29 a share in BofA stock (NYSE:BAC) — a 70 percent premium to Friday’s closing price of $17.05, but less than a third Merrill’s (NYSE:MER) all-time high of $97.53 reached in January 2007.The combination, if approved by shareholders, comes with the backing of federal officials worried thhat Merrill would follow Lehman Brothers Inc.(NYSE:LEH) to the brink of failure, the Times reported citing unnamed sources.
The Wall Street Journal reported that Bof A considered a bid for Lehman, but decided that Merrill was a better deal cheap payday loans. Barclays PLC was also considering buying Merrill, but both potential buyers backed off after it was clear there wasn't going to be government aid similar to what JPMorgan Chase & Co. got from the Federal Reserve when it bought Bear Stearns Cos. in March.
As a result, Lehman Bros. was reportedly preparing a bankruptcy filing that would would allow most of the firm’s units to continue operating as the business is wound down, the Journal reported.