Oct 10, 2008 9:46 am US/Pacific
Feds Clear SF-Based Wells Fargo To Buy Wachovia
SAN FRANCISCO (AP) ―
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A woman walks past Wachovia Bank ATMs in San Francisco.
Justin Sullivan/Getty Images
Federal antitrust regulators on Friday cleared Wells Fargo's $11.7 billion acquisition of Wachovia Corp., capping a weeklong battle for the Charlotte, N.C.-based bank.
The rapid approval comes a day after Citigroup Inc. walked away from its own efforts to buy Wachovia. Late Thursday, Citigroup broke off talks with Wells Fargo and federal regulators after the suitors failed to reach an agreement over how to split up the bank.
San Francisco-based Wells Fargo & Co. said Thursday it would proceed with the purchase and plans to complete the deal by the end of the fourth quarter. The acquisition still needs the approval of Wachovia shareholders.
The Federal Trade Commission included the deal on a list of transactions released Friday that received an "early termination" of their antitrust reviews. Early termination refers to the completion of a review by the FTC or Justice Department before the end of a 30-day period required under antitrust law.
Citigroup agreed last week to buy Wachovia's banking operations for $2.1 billion in a deal brokered by the Federal Deposit Insurance Corp. Four days later, Wells Fargo stunned Citigroup by announcing that Wachovia's board had agreed to an $11.7 billion all-stock offer. Originally, the deal was valued at $15.1 billion, or $7 a share, but Wells Fargo stock has declined since it was announced.
The fight for control of Wachovia moved to both state and federal court last weekend. Citigroup charged that Wells Fargo violated an exclusivity agreement it had with Wachovia.
On Monday, at the urging of federal regulators, the parties agreed to halt all legal proceedings in an effort to reach a quick resolution outside of court. The standstill, after an extension, was set to end Friday morning.
While Citigroup plans to seek $60 billion in damages for breach of contract, it has decided not to challenge the Wells Fargo-Wachovia deal in court.
(© 2009 The Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)
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