Countrywide for a steal

Talk about a deal that's hard to turn down. You might recall that Bank of America came to Countrywide's rescue last summer with an emergency infusion of $2 billion (translated to a 16 percent stake in the company). That turned out to be little more than a Band-Aid for the beleaguered mortgage company, but now B of A can buy the whole damn company for just another $3 billion, Before the housing crisis, it would have been closer to $30 billion. Deal Journal's Dana Cimilluca offers some additional logic:

The simple act of buying Countrywide will also make it a more valuable company. Giving Countrywide access to BofA’s balance sheet will make it cheaper to fund Countrywide’s operations and ensure it won’t fail. To say nothing of marrying Countrywide’s origination prowess with BofA’s distribution. And had BofA not stepped up, it is possible no one else would have, given the right of first reversal BofA has on any acquisition of Countrywide.

There's a more fundamental reason to make a deal: If Countrywide slips into bankruptcy - as now appears to be at least a possibility - B of A would have a tough time recouping that original $2 billion investment. So the idea is good money going after bad - but perhaps in a good way. Got it?