Merrill Lynch to price principal-protected notes linked to index basket

By Angela McDaniels

Seattle, Jan. 17 - Merrill Lynch & Co., Inc. plans to price an offering of zero-coupon principal-protected notes due July 2010 linked to a basket of indexes, according to a 424B3 filing with the Securities and Exchange Commission.

The basket will include equal weights of the Dow Jones-AIG Commodity, Dow Jones Euro Stoxx 50, FTSE/Xinhua China 25 and Nikkei 225 indexes.

The notes will price at par of $10.00 and will settle sometime in January.

If the final basket level is greater than the initial basket level, the payout at maturity will be par plus the percentage increase in the basket multiplied by the participation rate, which will be between 185% and 190% and will be determined at pricing. Investors will receive at least par.

Merrill Lynch, Pierce, Fenner & Smith Inc. will be the underwriter.

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