At first glance, it looked as if the shotgun marriage of Merrill Lynch & Co. with Bank of America Corp. had bailed out Temasek Holdings Pte. Ltd., who had poured nearly $6 billion into the investment bank this year, only to watch the value of its stake evaporate.
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The Singapore government-controlled entity is Merrill's largest
shareholder with a 7.5% stake. Temasek put $5 billion into Merrill at
$48 a share between December and February, but a
reset payment for
losses on the original investment and additional $900 million poured in
last month ended up averaging out the sovereign wealth fund's buy-in price to
only $23.11 a share, based on
Bloomberg calculations from exchange filings.
At Bank of America's orginal estimate of $29 a share, Temasek would
have ended up making $1.5 billion on its investment. Unfortunately, the
markets haven't been kind to the stocks of either BofA or Merrill. At the end of the day, Bank of America was down $7.19 or 21.3% to close $26.55, while
Merrill Lynch only gained a penny at close, ending the day at $17.06 a share, leaving
Temasek's investment still well into the loss column. -
George White
See story from Bloomberg
See Dealscape post on Temasek investment
| Merrill Lynch's top shareholders |
| Winners and Losers from the Bank of America buyout |
Investor |
Ownership* |
Profit/(Loss) |
| Temasek Holdings Pte. Ltd. |
5.7% |
(785,154,816) |
| State Street Global Advisors |
5.4 |
(676,409,920) |
| Davis Selected Advisers LP |
3.9 |
251,050,112 |
| AllianceBernstein LP |
3.2 |
(916,748,224) |
| Barclays Global Investors |
2.3 |
(295,482,496) |
| Lord, Abbett & Co. LLC |
2.1 |
(232,358,560) |
*Postitions were reported on June 30
Source: MSN Money |
