The Cougar head emblem does cover the old Mercury emblem's holes, but you do need to drill two new holes to fit the studs of the new emblem.
Note: Old (and new) emblem are held in place with a special double sided adhesive ring that you will cut through with fish line. Remove hatch liner to expose the old emblem's studs on the inside, gently push them out after you have cut the adhesive ring on the other side.
metallicacougs had this done to her car. when her car got wrecked she had the body shop take off the cougar emblem on the grill and put it on the back, because IIRC the grill was damaged in the wreck and she got a new one anyways.
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