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With all of the big losses that Merrill Lynch & Co. is racking up, the bank may be forced to part with coveted fund manager BlackRock Inc. after all, just to shore up its balance sheet.
A research report from CreditSights said that the $4.9 billion
loss Merrill reported added to the $19 billion it lost over the
past four quarters and may make the sale of Blackrock a necessity in order
to shore up the bank's balance sheet. Reuters is reporting
that the BlackRock stake "may be in play if hot stove losses continue,
even though the company indicates otherwise," CreditSights analyst
David Hendler co-wrote in a report, released late Thursday.
Merrill owns a nearly 50% stake in BlackRock, which is valued at roughly $12 billion. The bank's CEO, John Thain, had said that a sale was possible at the same time the bank was shopping a stake in Bloomberg LP. Merrill said Thursday it had decided against selling BlackRock, which it considered an important strategic asset. -- George White See Reuters story on analyst report See Dealscape post on Merrill's earnings See Dealscape post on Blackrock Categories Deal Video
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