BofA Sets Closing Date For Countrywide Purchase

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Bank of America Corp. aims to complete its planned acquisition of Countrywide Financial Corp. July 1, the Wall Street Journal reports.


An email sent to Countrywide managers early Thursday announced that target date, assuming that Countrywide shareholders approve the purchase, as expected, at a shareholders meeting June 25. A Bank of America spokesman later confirmed the planned timing, which is still subject to last-minute hitches. Speculation has swirled for months that the deal could fall through, but the email signals that Bank of America is preparing to complete it.


Previously, Bank of America said that it planned to complete the purchase in the third quarter.


Based on Bank of America’s closing share price of $28.14, the planned exchange of 0.1822 share of Bank of America stock for each share of Countrywide values the mortgage lender at about $3 billion, or $5.13 per share. Countrywide shares closed at $4.83, up 16 cents.


Completion of the acquisition would come as a relief for policy makers worried about the stability of the U.S. mortgage market. Bank of America has long been viewed in Washington as having the financial strength and ability to work with regulators needed to shore up Countrywide, which has been devastated by surging defaults and investigations of its lending practices.


Bondholders have expressed anxiety over whether Bank of America will take responsibility for all of Countrywide’s debt. Bank of America has declined to detail how Countrywide bonds will be handled, but bondholders appeared to welcome the news of a planned closing date.


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