Wachovia: Wells Fargo deal still on
CHARLOTTE, N.C. — Wachovia Corp. said Sunday it does not believe an order by a state supreme court judge in New York has "any effect on the validity" of a merger agreement between the Charlotte bank and Wells Fargo & Co.
The $15 billion Wachovia-Wells deal announced Friday upset a transaction brokered Sept. 29 that would have sold most of Wachovia to New York-based Citigroup Inc., with help from the Federal Deposit Insurance Corp.
Citi fought back Saturday by getting New York State Supreme Court Judge Charles Ramos to grant an emergency injunction that extends an "exclusivity agreement" that Citi argues prevents Wachovia from negotiating or entering into a merger agreement with any party other than Citi.
Wachovia, however, said it "continues to believe its agreement with Wells Fargo, which involves no government assistance, is proper and valid," adding: "The agreement is in the best interests of shareholders, employees, creditors and retirees as well as the American taxpayers and it imposes no risk to the FDIC fund."
Another court hearing is taking place this afternoon, sources familiar with the situation said.
Wachovia also said Citi is free to make a "superior offer" to Wachovia. In its statement Saturday, Citi said it is "prepared to continue negotiations with Wachovia on the parties' previously agreed-to transaction."
In a statement Sunday, Wells Fargo said it has a "binding merger agreement" with Wachovia.
"That agreement represents a transaction that, in stark contrast to Citigroup's proposal, provides significant and certain value to Wachovia shareholders, keeps Wachovia intact, is better for all of Wachovia's stakeholders including its employees and does not demand financial support from our government," Wells said in the statement.
