State Treasurer David Lemoine says Maine has reached agreement with Merrill Lynch to recover $20 million the state paid to purchase Mainsail II commercial paper last summer.

Announcing the settlement Thursday, Lemoine said the agreement restores the state's long-standing relationship with Merrill Lynch.

The state's $20 million investment of cash pool funds in Mainsail II left Lemoine in the hot seat when Mainsail II assets were frozen, putting the state's investment in question.

Lemoine has said that a financial adviser from Merrill Lynch advised the treasury that the investment met the state's criteria.

Lemoine noted Thursday that Merrill Lynch maintains it did nothing wrong, "but agreed to repurchase the paper to resolve this disagreement."