Merrill Lynch and PNC Financial Services Group both plan to exchange common shares of BlackRock Inc. for non-voting preferred shares, said BlackRock spokeswoman Bobbie Collins.
Ms. Collins said the exchanges will not affect the two firms’ ownership interests in BlackRock; Merrill still owns 49.5% of BlackRock and PNC, 33%.
In an agreement dated Dec. 26, Merrill will have a 4.9% voting stake in BlackRock, down from about 48.5%, while PNC’s total voting stake in BlackRock will grow to 47% from 36.5%, according to BlackRock’s 8-K filing with the SEC.
Ms. Collins confirmed that under a shareholder agreement with BlackRock, Merrill Lynch was obligated to reduce its voting stake below 25% upon a change of control. Merrill Lynch’s pending acquisition by Bank of America Corp., expected to close Jan. 1, triggered the change-of-control provision. “Merrill Lynch still holds the same number of shares. There is no ownership change,” she said.
