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Citi Fights Wells 4 Wachovia >>

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Mike Kennedy

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http://news.yahoo.com/s/ap/20081003/ap_on_bi_ge/wells_fargo_wachovia

NEW YORK - A battle broke out for control of Wachovia Friday as Wells Fargo signed a $15.1 billion agreement to buy the Charlotte, N.C.-based bank, while Citigroup and the federal regulators backing its earlier deal insisted that Citi's takeover bid go forward.

Suprise announcement early Friday by Wachovia Corp. that it had agreed to be acquired by San Francisco-based Wells Fargo & Co. in the all-stock deal — without government assistance — upended what had appeared to be a carefully examined arrangement and caught regulators off guard.

The Citigroup deal, announced Monday, would have been done with the help of the Federal Deposit Insurance Corp., but the Wells deal would be done without it. The head of the FDIC said the agency is standing behind the agreement it made with Citigroup Inc.

Citigroup, which demanded that Wachovia call off its deal with Wells Fargo, said its agreement with Wachovia provides that the bank will not enter into any transaction with any party other than Citi or negotiate with anyone else.
 

Restrain

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There's case law for Citigroup. Remember the Texaco/Pennzoil deal? I'm a little hazy on the particulars, but Pennzoil and Texaco were trying to buy another company. Pennzoil had a "handshake" deal to buy, then Texaco came in with a bigger offer. US Supreme Court held for Pennzoil and Texaco had to pay millions in damages.
 

Couch Potato

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I don't think the Pennzoil case lines up exactly with this one due to the FDIC involvement in the deal. It is one thing to enter into an agreement of your own free will, and quite another to enter into an agreement when coerced by a federal agency.
 

Bama Bayou

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The shocking news is that there is a fight over the purchase of a bank.
 

Terrel L. Shields

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Remember the Texaco/Pennzoil deal? I'm a little hazy on the particulars, but Pennzoil and Texaco were trying to buy another company. Pennzoil had a "handshake" deal to buy, then Texaco came in with a bigger offer. US Supreme Court held for Pennzoil and Texaco had to pay millions in damages.
And where's Texaco today? gone. Wacky is down either way, but Bama states the obvious and it begs the question...who is vetting these companies? $2 or $9 a share...someone is NOT valuing the assets correctly. Either the FDIC is sanctioning robbery (my bet) or stagecoach is pulling one stupid move.
 

Couch Potato

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And where's Texaco today? gone. Wacky is down either way, but Bama states the obvious and it begs the question...who is vetting these companies? $2 or $9 a share...someone is NOT valuing the assets correctly. Either the FDIC is sanctioning robbery (my bet) or stagecoach is pulling one stupid move.
Texaco is not "gone" rather swallowed and digested into Chevron.

Using the stagecoach estimates on losses, Citi was attempting to steal the assets and getting the government to take more than 40 billion in losses for them. Citi was trying to squeeze every penny out the transaction, and now they will get zilch. The political cost of the government taking losses on the deal just won't let the Citi deal fly with the Wells deal available.
 

Eli Weiss

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Citi: Wells Fargo blocked from buying Wachovia

Citigroup says NY judge temporarily agrees to block Wells Fargo from acquiring Wachovia


NEW YORK (AP) -- The fight over control of Wachovia intensified Saturday, as a judge temporarily agreed to block the sale of the bank by Wells Fargo, Citigroup announced in a news release.
State Supreme Court Justice Charles Ramos issued the order blocking the sale of Wachovia Corp., which Wells Fargo & Co. had agreed to purchase in a $14.8 billion deal.
http://biz.yahoo.com/ap/081005/wells_fargo_wachovia.html
 

Couch Potato

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A New York judge sides with a New York bank, imagine that. :rof:
 

William K

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If this isn't absolute idiocy. The only way Citi could buy it is with FDIC money! Only reason FDIC even considered backing Citi is because no one else was going to buy it and the FDIC didn't want another Bank failure.

So in comes Wells and after thinking about it decides it might be worth it and offers a (fair?) price without government backing. ( I believe a free market at work) and now Citi is upset?!
Use your own damn money then!!!:new_argue:
I'm still trying to figure out how I am going to pay for this $700Billion bill I just got!:shrug:
 
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