Wells Fargo & Co said today it reached a deal to buy Wachovia Corp for about $15.1 billion, after Citigroup's attempt to buy Wachovia's banking assets was called off.
Prior to receiving the Wells Fargo proposal, Wachovia had been negotiating with Citigroup to complete a transaction supervised by the Federal Deposit Insurance Corporation (FDIC) that included assistance from the government.
A Wachovia spokeswoman said neither Citigroup nor the FDIC is involved in the transaction. Citi officials did not immediately return calls for comment.
"This deal enables us to keep Wachovia intact and preserve the value of an integrated company, without government support," said Wachovia President and Chief Executive Robert Steel.
Wachovia's board approved Wells Fargo's offer last night.
Wachovia shareholders will receive 0.1991 shares of Wells Fargo common stock for each share of Wachovia common.
Wachovia closed at $3.91 yesterday, while Wells Fargo ended at $35.16, valuing Wachovia at just over $7, or a 79 per cent premium.
Reuters