Merrill Lynch: Still Bullish on NJ?
Merrill Lynch, the third largest employer in the greater Princeton area, is being sold to Bank of America in a most unusual negotiation that began on Saturday night and was essentially over before the start of business on Monday, September 15.
During a weekend of what is being called unprecedented financial turmoil, the United States government, out some $500 billion since March after propping up Fannie Mae, Freddie Mac, and Bear Stearns, decided that it would not bail out Lehman Brothers, a 158-year-old financial firm being crushed by its debt.
As Lehman learned that it would not be rescued, and that no bank or consortium of banks would buy it unless the government backed its debt, it prepared its bankruptcy filing. Merrill Lynch, fearing that it could be next in line, agree to be acquired by Bank of America for $50 billion.
Few logistical details have emerged following the whirlwind sale. It has been widely reported, however, that Bank of America CEO Ken Lewis is hinting at significant lay-offs among Merrill Lynch’s 60,000 employees. No decisions have been made, but the acquirerer has said that it plans to cut $7 billion from Merrill Lynch’s costs within the next few years.
The role of Merrill Lynch CEO John Thain had not been announced by press time.
Merrill Lynch has some 5,600 employees in the Princeton area, most working from its Hopewell office campus, and many providing back office support for the company’s 16,000 brokers, who together form the crown jewel of the company and are being cited as a major asset for Bank of America.
The company also has a large private client group at 7 Roszel Road, and even operates a day care center.
It is not yet known whether any of the company’s central New Jersey employees will be affected by the sale to Bank of America. Should there be downsizing at Merrill Lynch’s Hopewell location, the company would be ready to lease some of its space. Unlike Merrill Lynch’s former central New Jersey home, at Scudders Mill Road in Plainsboro, in which all of the space was interconnected, the 130-acre Hopewell campus was built in self-contained sections. Each group of buildings has its own parking, cafeteria, and amenities. (U.S. 1, April, 4, 2000 and November 15, 2006).
But no sub-leasing may be necessary. It is not impossible that the sudden sale of Merrill Lynch could be good for the area, posits Aubrey Haines, a principal in the Mercer Oak commercial realty firm.
“There could be a silver lining,” says Haines. “Maybe Merrill Lynch will move some of its employees out of high-rent New York City offices and into low-rent New Jersey offices.”
Merrill Lynch & Co. Inc. (MER), 1200 Merrill Lynch Drive, Pennington 08534; 609-274-1000; fax, 609-274-0100. James McCormick, first vice president, North American Facilities. Home page: www.ml.com.
Merrill Lynch Global Wealth Management, 14 North Harrison Street, Princeton 08540; 609-806-2544; fax, 609-806-2543. William R. Clampffer.
Merrill Lynch Private Client Group (MER), 7 Roszel Road, The Commons, Princeton 08540; 609-243-7900; fax, 609-243-7817. Deborah Shepherd, director.