Student

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|Merrill Lynch’s Acquisition of Mercury Asset Management |

|International Financial Management FINC/INBS – 533 |

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|Rob and Julia |

|2/5/2011 |

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I. Introduction

In the late 1990s, Merrill Lynch encountered challenges and opportunities as the company attempted to build its asset management business globally. The firm acquired U.K.-based Mercury Asset Management at a premium price of $5.3 billion. Mercury Asset Management had strong market pension presence in U.K. and Japan. This transaction permitted Merrill Lynch to better exploit opportunities in Europe as well as the rest of the world. Hence, this acquisition made Merrill Lynch one of the world’s largest asset management organizations with over $450 billion of assets under management. The firm would manage diverse assets across the world with a mix of retail/institutional accounts, fixed income/equity assets, and domestic/international exposures.

II. Merrill Lynch & Co., Inc. Background

In 1914 Charles Merrill and his partner friend opened an underwriting firm offering personal service to investors. Merrill Lynch was the...