Temasek Holding Shows 9.4% Stake in Merrill Lynch (MER)
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In a 13G filing on Merrill Lynch (NYSE: MER) this morning, Temasek Holdings disclosed that they hold a 9.4% stake, or 91,666,666 shares, in the investment bank.
In December, Merrill, hit with massive write-downs due to the submprime debacle, said they would raise up to $6.2 billion in a deal with Temasek Holdings and Davis Selected Advisors
Under the plan, Temasek Holdings was to invest $4.4 billion in Merrill Lynch common stock, with an option to purchase an additional $600 million of Merrill Lynch common stock by March 28, 2008. Under the deal, Temasek's ownership position will at all times be less than 10% of Merrill Lynch's outstanding shares.
Temasek made the initial investment of $4.4 billion at $48 per share (91,666,666 shares). Temasek has an option to buy an additional 12,500,000 shares, also at $48.
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Bad investment?
whartoncu on Jul 4, 2008 07:36 PMWith Merrill Lynch at $31 now, it seems like Temasek had under-estimated the credit crunch crisis and made a bad investment on Merrill.