Merrill Lynch plans to raise $8.5bn through new shares as the US investment banking giant faces a further $5.7bn write-down in Q3.
Wall Street was stunned by the surprise statement last night, with Merrill’s share price plunging 11.6%. The majority of the write-down will come from the $11.1bn sale of collateralised debt obligations (CDO) securities, also announced yesterday. Merrill’s has been hit hard by the sub-prime related credit crisis, with over $18bn of losses and about $40bn in write-downs over the past year. Earlier this month, Merrill sold its 20% stake in news group Bloomberg and a controlling interest in Financial Data Services for a combined $8bn. Singapore’s Temasek Holdings will purchase $3.4bn of co...
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