Merrill Lynch said it plans to raise $8.5 billion by selling shares, with about $3.4 billion going to the Singaporean sovereign-wealth fund Temasek, which bought $5 billion in Merrill shares in December. Merrill also agreed to sell a package of collateralized-debt obligations to private-equity firm Lone Star Funds for $6.7 billion. The CDOs had a stated worth of $30.6 billion but were on Merrill's books at $11.1 billion. The bank will take a $4.4 billion write-down this quarter.

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