Financial companies tend not to go independent these days: rather, many are looking for deep-pocketed acquirers. Look at last year’s sale of Household to HSBC. With no other funding avenues available to it than the debt markets, Household was crushed by the credit meltdown of the second half of last year. Its spreads gapped out to more than 800 basis points over treasuries, and it was unable to raise capital. Selling out to a larger, more stable, better-rated institution was about the only viable option it had.
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