SRM Fund Management Said BofA Merger Deal Undervalues Countrywide (CFC)
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In a 13D filing on Countrywide Financial Corp. (NYSE: CFC) this morning, SRM Fund Management disclosed a 5.19% stake in the mortgage company and said the merger agreement with Banc of America (NYSE: BAC) undervalues the company.
On January 11, Banc of America and Countrywide announced a definitive merger agreement. Under the deal would receive .1822 of a share of Bank of America stock in exchange for each share of Countrywide.
SRM said, "Based on publicly available information we understand that even after the fourth quarter loss, the Company has a book value as of December 31, 2007 in excess of 20 dollars per share, in addition to its substantial franchise value as the leading mortgage business in the United States and its
insurance business."
SRM plans to vote against the proposed merger.
On January 11, Banc of America and Countrywide announced a definitive merger agreement. Under the deal would receive .1822 of a share of Bank of America stock in exchange for each share of Countrywide.
SRM said, "Based on publicly available information we understand that even after the fourth quarter loss, the Company has a book value as of December 31, 2007 in excess of 20 dollars per share, in addition to its substantial franchise value as the leading mortgage business in the United States and its
insurance business."
SRM plans to vote against the proposed merger.
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