In a deal that saves the ass of the nation's largest mortgage lender, Bank of America has agreed to buy Countrywide in a 'stock-only' sale. Countrywide has been rumored to of been considering a Chapter 11 filing recently with the value of their stock at a garbage rate of $5 a share in December. "As of Sept. 30, Countrywide's savings bank held about $79.5 billion of loans as investments. Three-quarters of these loans were second-lien home-equity loans -- where Countrywide doesn't have first crack at the collateral in case of default"-according to the Wall Street Journal.The WSJ has a nice explanation of what it all means here. The person who makes out like the bandit he is in this deal?
Why, the founder of Countrywide of course. Chief Executive Angelo Mozilo. Angelo might be taking home a nice little golden parachute of..wait for it...
$70 million bucks
Yep, that ain't a typo folks. Meanwhile the stockholders will get: 0.1822 shares of Bank of America for each share of Countrywide. Yes, that is a big fat fucking zero in front of that decimal point. Sure, they now will own stock in the largest bank in the US, but damn, that trade-off sure doesn't look real inviting does it? Bank of America gets a company that was valued at one time the amount of $24 Billion, and they got it for the bargain basement price of $4 Billion.
Oh, and Angelo will also get his countryclub dues paid through the year 2011 and get to use the corporate jet. Chuck Shumer had this to say about Angelo's sweet deal:
Oh, and Angelo will also get his countryclub dues paid through the year 2011 and get to use the corporate jet. Chuck Shumer had this to say about Angelo's sweet deal:
"Mr. Mozilo could display some good will by donating any severance pay he stands to receive to the nonprofit housing counselors trying to prevent foreclosures,"
Somehow, I doubt that will happen Chuckie..
