Merrill Lynch sold in $50bn deal Source: BBC
Lehman Bros files for bankruptcy
The fourth-largest investment bank in the US, Lehman Brothers, has said it will file for bankruptcy protection, amid a growing global financial crisis.
Lehman had incurred losses of billions of dollars in the US mortgage market.
The move threatens to deal a further blow to the global financial system, as banks unwind their deals with Lehman.
Bank of America is to buy Merrill Lynch in a deal worth $50bn (£28bn) that will create a new financial giant.
The deal came amid a hectic weekend on Wall Street, with Lehman Brothers announcing that it would file for bankruptcy protection.
There were worries that Merrill would be the next bank to lose the confidence of investors as it has been hit hard by bad mortgage debt.
Merrill has written down more than $40bn of assets in the past year.
Under the terms of the deal, Bank of America will pay about $29 for each Merrill share.
While that represents a 70% premium to the closing share price on Friday, Merrill's share price stood at $50 in May and was above $90 at the start of 2007.
Lehman Brothers bankrupt, Merrill Lynch buyout
daVe.. (Student) (1431 Points)
15 September 2008
CAclubindia
