Case Study on Merrill Lynch

Merrill Lynch was an American stock broker company. Until the beginning of 2008, it was the top stock broker company in America. The crisis started affecting it in the mid of September 2008, when its shares faced a six percent decline, the lowest in two years, for the used to be stock giant . It was during this time that the bank of America decided to buy the multibillion dollar firm for $50 billion. It also announced that it would pay $12 over the original stocks of Merrill to achieve full control over the company. Even this was only half of what the company was worth.
Initially, this posed a picture of just another major market facing a serious crisis, it was confirmed when the CEO resigned. It thus raised the prices just for a short while, when people started expecting better, new management. But the stocks plummeted once again, when sub prime mortgages became one of the causes for the rise in the crisis.
Merrill Lynch was once the biggest stockbroker company in the world it had 16000 stock brokers in the world, but as stocks plummeted in Wall Street. It was thus that the company had earned many titles in wall street and this is what provoked The Bank of America to buy the company. The bank did so in an attempt to save the company from completely dissolving. And to establish a firm grip over the Real Estate and banking sector of the US which will be hard to rival.