April 30 (Bloomberg) -- Merrill Lynch & Co. is in talks with former Goldman Sachs Group Inc. executive Peter Kraus about a job overseeing strategy at the brokerage firm, said a person familiar with the matter.

Kraus, who left Goldman in March after almost 22 years at the company, was most recently co-head of its asset management division. He didn't respond to a request for comment and Merrill spokeswoman Jessica Oppenheim declined to comment. Both firms are based in New York.

John Thain, Merrill's chairman and chief executive officer since December, is recruiting former colleagues from Goldman, where he worked for about 25 years, as he seeks to restore profitability after three consecutive quarterly losses. Thain announced April 28 that he'd hired Goldman's former U.S. trading chief, Thomas Montag, to run Merrill's global sales and trading operation.

``Merrill Lynch's executive suite is basically just becoming an offshoot of Goldman Sachs,'' said James Ellman, president of SeaCliff Capital in San Francisco, which has about $150 million under management, including Merrill shares. Given the performance of the two firms, ``it's hard to see how it can be a bad thing.''

Under CEO Lloyd Blankfein, Goldman's earnings climbed 22 percent last year to $11.6 billion, setting a Wall Street record. Merrill, led by CEO Stan O'Neal until he was forced to leave in October, lost $7.78 billion in 2007 because of losses tied to subprime mortgages. Goldman is the biggest U.S. securities firm by market value; Merrill is the third-largest.

Others Hired

Other former Goldman executives hired by Thain include Noel Donohoe as co-chief risk officer and May Lee as chief of staff.

In a memo to employees yesterday, Thain said he had formed a 10-person management committee to foster ``teamwork, collaboration and cross-selling.'' Half of the members are new to Merrill, including Thain, Montag, Chief Financial Officer Nelson Chai, Chief Administrative Officer Thomas Sanzone and Margaret Tutwiler, head of communications and public affairs.

Others on the committee include President Greg Fleming, global wealth management head Robert McCann, general counsel Rosemary Berkery, investment-banking chief Andrea Orcel and Jason Brand, who oversees the firm's businesses in the Pacific Rim.

Global Alpha

Kraus, 55, was co-head of the Goldman investment banking team that advised financial institutions before he joined the private wealth management group and then took the lead in the fund management division.

Goldman's asset management business suffered losses in some hedge funds last year, paring the firm's performance-related fees. The Global Alpha hedge fund, once the bank's biggest, fell about 40 percent in 2007 because of wrong-way bets on currencies, equities and bonds worldwide.

First-quarter revenue in the division rose 23 percent from a year earlier as assets under management jumped 21 percent to a record $873 billion.

``There were a couple of products that did poorly, but I think you should lay that on the hedge fund manager, not on the guy running the unit,'' Ellman said.

Merrill's management ranks have thinned since Thain, 52, took over as CEO on Dec. 1, as executives promoted under O'Neal stepped down or were forced out. Co-president Ahmass Fakahany quit in February, leaving Fleming as the sole president. On April 7, Merrill announced the pending departure of Rohit D'Souza, who has led the stock-trading division since 2004.

Soltas, Cutler

Scott Soltas, the 46-year-old head of the global mortgage business, is leaving and taking an early retirement package, people familiar with the decision said today. Stewart Cutler, a managing director at the firm's asset-backed commercial paper group, is also leaving, the people said. David Sobotka, the head of fixed-income, commodities and currencies, has told colleagues he's leaving, people familiar with the matter said last week.

Harin de Silva, who oversaw Merrill's business of packaging mortgage bonds and asset-backed securities into so-called collateralized debt obligations, left the firm last week. De Silva joined Merrill in April 2003 from Credit Suisse First Boston. He confirmed his departure and declined to comment further.

Merrill is a passive, minority investor in Bloomberg LP, the parent of Bloomberg News.

To contact the reporters on this story: Christine Harper in New York at charper@bloomberg.net; Bradley Keoun in New York at bkeoun@bloomberg.net.

Last Updated: April 30, 2008 17:34 EDT