Wachovia, Citi, Wells Fargo drama continues
The battle for control of troubled bank Wachovia tilted toward Wells Fargo Sunday as a state appeals court blocked a lower court ruling that had favored rival bidder Citigroup, according to the Associated Press.
On Friday, news erupted that Wachovia agreed to be acquired by San Francisco-based Wells Fargo & Co. in a $15.1 billion all-stock deal. Wells Fargo is the second largest employer and the biggest financial institution in the state.
According to the Associated Press:
At stake is the $339 billion in Wachovia deposits and its network of more than 3,300 branches throughout the country that would solidify the winner as being in the top tier of U.S. retail banking.
In the Sunday night ruling, the Appellate Division of State Supreme Court threw out an order by Justice Charles Ramos issued late Saturday at the request of Citigroup; the order would have extended the time under which Wachovia and Citigroup had to complete their deal.
With both Wells Fargo and Citigroup vowing to press their legal rights to a deal with Charlotte, N.C.-based Wachovia, analysts warned that a prolonged takeover fight carries enormous risk at a time when the nation's financial system is under the worst stress since the Great Depression.
Watching two banking companies fight over a failing company seems almost laughable. In this economic situation, we are running from anything that smells. But the power and money hungry bankers clearly run on a different financial risk process. This fight is far from over and we will keep you updated on new developments.