Released: October 03, 2008

Wells Fargo to acquire Wachovia

Source: Associated Press, (LA Times) (Free Registration)

In an abrupt change of course, Wachovia Corp. said today it agreed to be acquired by Wells Fargo & Co. in a $15.1 billion all-stock deal, wiping out Wachovia’s previous plan to sell its banking operations to rival suitor Citigroup Inc.

A key difference is that the Wachovia deal will be done without government assistance, while the Citigroup deal would have been done with the help of the Federal Deposit Insurance Corp.

“This deal enables us to keep Wachovia intact and preserve the value of an integrated company, without government support,” Robert Steel, Wachovia’s president and chief executive, said in a statement.  The Wachovia-Wells deal, announced today, comes in a turbulent time for banks and financial firms as they grapple with the ongoing credit crisis, which led to the recent bankruptcy of Lehman Brothers Holdings Inc. and the failure of Washington Mutual Inc.

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