Friday's Financial Winners & Losers
Financial stocks were blasting off Friday, together with the jubilant broad indices, in a last full-trading-day hurrah before the markets close on Christmas. Trading will end early on Monday.
Leading the skyward surge was First Marblehead (FMD), which was up some 70% after Goldman Sachs (GS) agreed to inject the student lender with up to $260.5 million by buying up to 19.99% of the firm's shares outstanding as of the time the deal closes. That kicks off today with a purchase of $59.8 million in securities convertible to shares at $11.24 apiece. Then, upon regulatory clearance, Goldman will buy up to another $200.7 million worth for a $15 per-share conversion price.
Goldman additionally agreed to establish a $1 billion warehouse lending facility for the company. Further, First Marblehead will suspend its dividend "for the foreseeable future" in an effort to preserve its cash levels. First Marblehead shares were jumping $7.65 to $18.89. Goldman was adding 3% at $208.79.
Merrill Lynch (MER) may also hop on the capital-infusion bandwagon: the troubled New York broker is currently in late-stage negotiations to get as much as $5 billion from Singapore-based Temasek Holdings, according to The Wall Street Journal. Shares gained 1.3% to $55.20.
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