By Laura Lutz
Des Moines, Dec. 24 - Merrill Lynch & Co., Inc arranged two private placements of common stock for up to $5.6 billion, according to a news release.
Temasek Holdings and Davis Selected Advisors are the investors.
Merrill Lynch has agreed to sell $4.4 billion of shares to Temasek for $48.00 per share, according to a term sheet for the deal.
Temasek also has an option to buy $600 million more of stock by March 28. If that option is exercised before the earlier of two weeks after regulatory approval and Jan. 31, the additional shares will be priced at $48.00. Otherwise, they will be priced at the greater of $48.00 and 90% of the then-current market price.
Temasek's stake in Merrill Lynch will remain less than 10%.
Of the Temasek placement, 60% will close on Dec. 28 and 40% will close on Jan. 11.
Davis has agreed to make a $1.2 billion long-term investment of common equity. Pricing of that deal was not announced.
Settlement of both deals is expected by mid-January.
Temasek placement
| Issuer: | Merrill Lynch & Co., Inc.
|
| Issue: | Stock
|
| Amount: | $4.4 billion
|
| Price: | $48.00
|
| Option: | For $600 million of shares
|
| Option expiration: | March 28, 2008
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| Option strike price: | $48.00 if exercised before earlier of two weeks after approval and Jan. 31; otherwise, greater of $48.00 and 90% of market price
|
| Investor: | Temasek Holdings
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| Announcement date: | Dec. 24
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| Settlement date: | Dec. 28 (for 60%); Jan. 11 (for 40%)
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| Stock symbol: | NYSE: MER
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| Stock price: | $55.54 at close Dec. 21
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