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| Litigation begins: Judge suspends Wachovia deal - |
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Eliza
 Posted:
Sat Oct 04, 2008 11:43 pm |
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Litigation begins: Judge suspends Wachovia deal
LINK
October 5, 2008
Citigroup Persuades Judge to Suspend Wachovia Deal
By ERIC DASH and JONATHAN D. GLATER
Citigroup announced late Saturday that it had persuaded a New York judge to temporarily block Wells Fargo from acquiring Wachovia, firing the first shot in what could be a prolonged legal battle.
Citigroup has accused Wells Fargo of wrecking its plan to acquire Wachovia’s banking operations for $2.2 billion, or $1 a share, in a deal arranged by the Federal Deposit Insurance Corporation. Four days after that deal was struck, it fell apart when Wachovia agreed to Wells Fargo’s offer to pay seven times as much for the entire company.
The underlying battle is over which company will emerge from the economic crisis in a stronger position among a smaller number of financial giants. Citigroup contends that the deal with Wells Fargo violates an agreement that prohibited Wachovia from having any sale or merger discussions with anyone other than Citigroup until Oct. 6.
The order issued by a judge on Saturday extends the term of that agreement until further court action, Citigroup said. A person briefed on the situation said that Citigroup was seeking $60 billion in damages from Wells Fargo for interfering with the initial transaction.
Efforts to reach a Wells Fargo representative late Saturday night were unsuccessful. Christy Phillips-Brown, a Wachovia spokeswoman, said the bank “believes its agreement with Wells is proper, valid, and is in the best interest of shareholders, employees and American taxpayers.”
“Under that agreement,” Ms. Phillips-Brown added, “Citigroup is always free to make a superior offer to Wachovia.”
The litigation could be a blockbuster, pitting some of the nation’s largest surviving financial institutions against one another and giving work to the most expensive legal talent money can buy. Citigroup is represented by the New York lawyer Gregory P. Joseph; Wachovia by David Boies of Boies, Schiller & Flexner; and Wells Fargo by Paul K. Rowe of Wachtell, Lipton, Rosen & Katz, according to people briefed on the matter.
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Joined: 21 Feb 2008
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Location: Deep in the hills with my Bible, rifle, and pony.
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| dugo
Posted:
Sun Oct 05, 2008 10:27 am |
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Veeeeery interesting .. The FDIC brokered this original deal? Time for some diggin'
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Dashing Dutch Dynamo Dude
Joined: 12 Apr 2006
Posts: 6007
Location: L4L
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| dugo
Posted:
Sun Oct 05, 2008 10:42 am |
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FDIC Chairman Sheila Bair Comments on Agreement to Merge by Wells Fargo and Wachovia
FOR IMMEDIATE RELEASE
October 3, 2008 Media Contact:
Andrew Gray
202-898-7192 or angray@fdic.gov
"Since the close of our bidding process, Wells has apparently re-assessed its position and come forth with this new offer that does not require FDIC assistance. It should be emphasized that both the Citigroup proposal as well as the new Wells proposal would stand behind all creditors including depositors, insured and uninsured. Under either proposal, all banking customers of the merged institutions would be fully covered with no disruptions in service.
"The FDIC stands behind its previously announced agreement with Citigroup. The FDIC will be reviewing all proposals and working with the primary regulators of all three institutions to pursue a resolution that serves the public interest."
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Dashing Dutch Dynamo Dude
Joined: 12 Apr 2006
Posts: 6007
Location: L4L
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| dugo
Posted:
Sun Oct 05, 2008 10:45 am |
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The Cabal is not going to like it..
JP Morgan Chase & Citigroup are supposed to get everything dime on the dollar, not Wells. They better inform the judge fast that Wells getting this is not according to the scam plan..
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Dashing Dutch Dynamo Dude
Joined: 12 Apr 2006
Posts: 6007
Location: L4L
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| dugo
Posted:
Sun Oct 05, 2008 10:53 am |
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Dirty stuff going on here, what part of the government made it so that JP Morgan got Bear Sterns for a rediculously low price? Or did they broker that on their own? Nah, can't be..
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Dashing Dutch Dynamo Dude
Joined: 12 Apr 2006
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Location: L4L
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| Eliza
Posted:
Sun Oct 05, 2008 3:55 pm |
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| dugo wrote: | | Dirty stuff going on here, what part of the government made it so that JP Morgan got Bear Sterns for a rediculously low price? Or did they broker that on their own? Nah, can't be.. |
With all the news breaking around the world this weekend, Monday morning could bring a nightmare to the financial markets. Worse than ever.
Perhaps the governments will take even further action on SUN evening as they've been known to do recently.
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Joined: 21 Feb 2008
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Location: Deep in the hills with my Bible, rifle, and pony.
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