Is Merrill Lynch & Co. looking to get closer to nature?

Late last week the company was looking for research on forestry securitizations in an effort to better familiarize itself with the debt financing side of the timber industry.

A source close to the situation said that the company is making a concerted effort to get a bit of market share for fee-based securitization duties in the relatively esoteric sector of timber asset-backed securities.

Merrill's increased coverage of the forestry sector began a few months ago with the hires of Anna Torma and Robert Bayer, two timber specialists charged with heading the newly created paper and forest products research department for the company.

"They just initiated coverage on a number of companies within the last month and a half," one insider said. "Merrill covered the paper industry before, but it hasn't been as extensive as what they're covering now."

Timber securitizations work similar to accounts receivable deals. In one example, Scotia Pacific Co. sold its trees to Pacific Lumber Co., a company that guaranteed a minimum harvest of Scotia's logs. Such a guarantee, said Moody's Investors Service, is what such transactions hinge on.

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