Why is BofA offering $29/share for Merrill Lynch? Because they are paying for it in stock, that’s why. And in case you were wondering what the market thinks of the deal, BofA stock was down over 7 points today (over 21%) while Merrill stock closed at $17, up a penny for the day. This tells me that the actual value of the deal will be significantly less than $29/share. Stay tuned. Oh, btw, I predict this deal WILL close. It just won’t be worth $29/share. Merrill’s decision to sell off its remaining subprime mortgage holdings a few weeks back is looking good right about now, wouldn’t you say?
