DealBook: Merrill-BofA Merger Vote Marks End of an Era

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Edited by Andrew Ross Sorkin

TODAY'S TOP HEADLINES | Friday, December 5, 2008 M & A: Bell Canada's Buyers Offer Revised Investment Plan BANKING: U.S. Aid to Markets Must Be Temporary, Cox Says PRIVATE EQUITY: Chrysler Under a Harsh Light at Hearing HEDGE FUNDS: Citadel Lost Another 12.7% in November OFFERINGS: High Anxiety About High Yield VENTURE CAPITAL: S.E.C. Charges a V.C. With Fraud LEGAL: Auto Executives Face a Hard Sell on Capitol Hill TOP STORY Merrill-BofA Merger Vote Marks End of an Era Shareholders vote Friday on Bank of America's acquisition of Merrill Lynch, a deal that changes the face of Wall Street and ends the independence of a financial-services icon. ''The I-bank model is gone,'' Keefe, Bruyette & Woods analyst Jefferson Harralson told the Associated Press. ''This vote is a visible piece of the changing world.'' Winthrop Smith Jr., a former head of Merrill's international brokerage and the son of a former Merrill chief executive, told Bloomberg News that the merger is "really like the death of a friend." He said he plans to attend Friday's vote, at which shareholders are widely expected to approve the combination. The merger vote is also a defining moment for Kenneth Lewis, Bank of America's deal-prone chief executive. Bloomberg writes that this latest acquisition may prove the hardest to digest. Go to Article from Bloomberg News» Go to Article from The Associated Press via The New York Times» Go to Article from CNNMoney.com» Read More Add a comment ADVERTISEMENT Back to Top MERGERS & ACQUISITIONS Some of the proposed buyers of the telecommunications giant BCE have offered to give up their troubled $50 billion takeover of the company and take a minority stake instead, The New York Times reported Thursday, citing people briefed on the matter. Go to Article from The New York Times» Go to Item from DealBook» Read More Add a comment Prudential Financial plans to sell its minority stake in Wachovia's brokerage unit to Wells Fargo in a deal that could yield Prudential a $1.7 billion after-tax gain. Go to Item from DealBook» Go to Webcast of Prudential's Investor Day» Read More Add a comment Electricite de France is back with a second bid for Constellation Energy, and what happens next will depend on Constellation's acquisition agreement with MidAmerican Energy. Go to Item from The Deal Professor» Read More Add a comment Capital One's purchase of Chevy Chase Bank is the latest bank deal to use a new tax break, but some lawmakers still hope to close the loophole. Go to Item from DealBook» Read More Add a comment A lawyer for Bally Total Fitness Holding said outside court on Thursday that the bankrupt health club operator is in discussions with one of its bank groups about financing related to a sale. Go to Article from Reuters via The New York Times» Go to Previous Item from DealBook» Read More Add a comment The E.W. Scripps Company announced Thursday that it was selling the money-losing Rocky Mountain News, its largest newspaper. Go to Article from The New York Times» Go to Press Release from E.W. Scripps» Read More Add a comment General Motors's decision to sell its corporate jets comes as the market is saturated with planes on the block -- as Lehman Brothers knows all to well. Go to Item from Dealscape» Read More Add a comment Back to Top INVESTMENT BANKING The federal government must plan an exit strategy for several programs it has put in place to help rescue the financial system, the chairman of the Securities and Exchange Commission said on Thursday. Go to Article from Reuters via The New York Times» Read More Add a comment Morgan Stanley analysts widened their fourth-quarter loss estimate on Goldman Sachs, citing a fall in equity, credit and real-estate asset values in November, and rising negative marks on the firm's illiquid asset and principal investment portfolios. Go to Article from Reuters via The New York Times» Go to Item from DealBook» Read More Add a comment Alex Widmer, the chief executive of Bank Julius Baer and a well respected figure in Swiss private banking, has died unexpectedly at the age of 52, the bank said on Friday. Go to Article from Reuters via The New York Times» Read More Add a comment Back to Top PRIVATE EQUITY Chrysler took its turn under a harsh spotlight Thursday, when one Republican senator suggested that the company's parent, Cerberus Capital Management, was more interested in finding a merger partner than building a viable automaker for the long term. Go to Article from The New York Times» Read More Add a comment Petty Enterprises, the Nascar team backed by private equity firm Boston Ventures, is in discussions to merge its storied franchise with Gillett Evernham Motorsports, The Associated Press reported. Go to Article from The Associated Press via The New York Times» Go to Article from Sports Illustrated» Read More Add a comment Back to Top HEDGE FUNDS Investors learned Thursday that Kenneth C. Griffin's Citadel Investment Group lost another 13 percent in November, bringing the its total investment losses to about 47 percent for the year. Go to Item from DealBook» Read More Add a comment D.E. Shaw and Farallon Capital have blocked investors in some of their funds from pulling out cash, the latest two hedge funds to raise their gates. Go to Item from DealBook» Read More Add a comment The agonies facing hedge funds highlight big flaws in the model that need fixing, Breakingviews says. In an interview with Reuters, Veritas Asset Management manager Ezra Sun blamed hedge fund "cowboys" for much of the reputational damage the industry is suffering. Go to Article from Breakingviews via The New York Times» Go to Article from Reuters» Read More Add a comment If activist investor Carl C. Icahn is going to profit from his $1.8 billion bet on Yahoo, the billionaire needs the struggling Internet company's stock to more than double in value. Go to Article from The Associated Press via The New York Times» Go to S.E.C. Filing from Icahn Funds » Go to Previous Item from DealBook» Read More Add a comment Hedge-fund manager Doug Kass, who successfully shorted U.S. equities this year including shares of Fannie Mae and Freddie Mac, says he is now buying U.S. stocks on the belief that they have hit bottom. Go to Article from Reuters via The New York Times» Read More Add a comment Back to Top I.P.O. / OFFERING The corporate junk-bond market took a global vacation in November, and understandably so: Investors are demanding huge yields to hold speculative debt these days. Go to Item from DealBook» Read More Add a comment Harvard University is preparing a $600 million bond issue to partly repay existing debt and also to cancel certain interest rate swap agreements, The Wall Street Journal reported. Go to Article from The Wall Street Journal (Subscription Required)» Go to Article from Reuters via The New York Times» Go to Previous Item from DealBook» Read More Add a comment Resolution, an investment vehicle founded by British insurance entrepreneur Clive Cowdery, has raised 600 million pounds ($880 million) in its initial public offering, the group announced on Friday. Go to Article from The Financial Times» Go to Article from Reuters» Go to Article from The Times of London» Read More Add a comment World markets were mostly lower Friday as caution ahead of a key reading on the U.S. jobs market overshadowed big rate cuts by central banks in Europe. Go to Article from The Associated Press via The New York Times» Read More Add a comment Back to Top VENTURE CAPITAL Federal authorities accused William Del Biaggio III, 41, a former Silicon Valley venture capitalist and part owner of the Nashville Predators hockey team, of defrauding investors and using the money to buy his $25 million stake in the professional sports team. Go to Article from The New York Times» Go to Press Release from the S.E.C.» Go to S.E.C. Complaint (PDF)» Read More Add a comment Venture capitalists were decidedly somber about the prospects of start-up companies in the tough economic climate, as they spoke on a panel at a clean-energy conference in Austin. Go to Item from Green Inc.» Read More Add a comment Social networking company Facebook is delaying a previously announced plan to let employees sell part of their stocks, due to difficult global economy, The Wall Street Journal reported. Go to Article from The Wall Street Journal» Go to Article from Valleywag» Go to Article from Reuters via The New York Times» Read More Add a comment Back to Top LEGAL The chief executives of America's foundering automobile manufacturers returned to Capitol Hill on Thursday and found themselves confronting years of pent-up anger, the harsh politics of a recession and the realization that even their strongest supporters might not be able to muster the votes to save them. Go to Article from The New York Times» Read More Add a comment France will spend 26 billion euros, or $33 billion, over the next two years to soften the blow of the global downturn and limit the effects of increasing unemployment, President Nicolas Sarkozy said Thursday. Go to Article from The New York Times» Go to Press Release from the Elysee Palace (In French)» Read More Add a comment Donald Trump is citing the recession as a "force majeure" in what The New York Times's Floyd Norris calls a fascinating lawsuit over $40 million that he personally guaranteed on a construction loan from Deutsche Bank. Go to Article from The New York Times» Read More Add a comment DealBook's column on executive compensation generated lots of debate; Roland A. Paul of the law firm Ivey, Barnum & O'Mara offers up another view. Go to Item from DealBook» Read More Add a comment Liechtenstein, under increasing scrutiny for its role as a leading offshore tax haven, has promised to partly lift the veil of secrecy shrouding billions of dollars held there by wealthy American clients and corporations. Go to Article from The New York Times» Read More Add a comment Now that Henry Blodget and his former nemesis, Eliot L. Spitzer, are under the same journalistic umbrella at the online magazine Slate the onetime Internet stock analyst extended an olive branch to the disgraced former New York governor. Go to Item from Silicon Alley Insider» Go to Item from DealBook» Read More Add a comment Get home delivery of The New York Times for as low as $3.15 a week.

SEARCH DEALBOOK SITE DealBook | E-mail Preferences Help | Advertising Opportunities Hedge funds brave hell and high water December 5, 2008 It's every man for himself at Opec December 5, 2008 Capital One light-years ahead in funding transformation December 4, 2008 A Yahoo Bid? Icahn Has Doubts Carl Icahn said a partial offer for Yahoo was likely to fall flat with shareholders. More» What's a Wall Street Chief Worth? With taxpayers' money on the line, creating packages that pay enough -- but not too much -- becomes an even thornier problem. More» Bracing for Bonus News London's financial workers expect their bonuses to drop as much as 70 percent from last year, according to a survey. More» Tracking the Bailout The New York Times tracks how the $700 billion Troubled Asset Relief Program is being doled out to banks, insurance companies and more. More» Revolving Door The latest hires, promotions and departures at Kirkland & Ellis, Fannie Mae, BlackRock and more. More» The Deal Professor A blog-within-a-blog that looks at mergers, private equity and corporate governance through a legal lens, written by Steven M. Davidoff, a professor at the University of Connecticut School of Law and a former lawyer at Shearman & Sterling. More» The Rescue Squad DealBook's special section looks at the people reshaping Wall Street and what the new landscape might look like. More» Lehman's Fall Full coverage of Lehman Brothers' dramatic slide into bankruptcy protection. More» The Bear Bailout Full coverage of the proposed takeover of the troubled investment bank -- and the crisis that led to the sale. More» DealBook for BlackBerry Get one-click access to DealBook to read the latest deal news throughout the day. Visit mobile.nytimes.com/bbinstall directly from your BlackBerry or by sending the text message "db install" to 698698. More information on DealBook for BlackBerry. News By Industry Airlines / Autos Basic Industries Consumer Goods Energy / Utilities Financial Services Food & Beverage Healthcare Media Real Estate Retail / Leisure Technology Telecom Tools & Resources GET QUOTES Look Up Symbol RESEARCH SUITE Portfolio Company Research U.S. Markets International Markets Mutual Funds SEND A TIP OR FEEDBACK E-mail us at dealbook@nytimes.com Dealboard

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