And the winner is: Wells FargoSubmitted by fanofwalt on Fri, 10/10/2008 - 00:45
Looks like Wells snapped it away from Citigroup (and the FDIC) --
Oct. 10 (Bloomberg) -- Wells Fargo & Co. will become the largest U.S. bank by branches with an $11.7 billion offer for ailing rival Wachovia Corp. that trumped a competing bid by Citigroup Inc.
Citigroup on Sept. 29 signed an agreement in principle to pay $2.2 billion for Wachovia's banking operations, leaving behind its securities brokerage and asset management businesses.
At the time, Wachovia was on the verge of collapsing into receivership, and Citigroup began plying it with emergency funding. Citigroup also agreed to pay to $12 billion to the Federal Deposit Insurance Corp. in exchange for a guarantee that the agency would absorb any losses beyond $42 billion on a $312 billion pool of Wachovia loans.
Later last week, as Congress considered bailout legislation that included tax breaks for buyers of troubled banks, FDIC Chairman Sheila Bair encouraged Wachovia CEO Robert Steel to ``give serious consideration'' to a new offer from Kovacevich, according to court filings submitted by Wachovia in the legal battle with Citigroup.
The FDIC said in a statement this week that ``neither Chairman Bair nor any person at the FDIC in any way initiated or solicited the bid from Wells Fargo.''
That last part right there is in opposition to reports that have been all over the place stating that FDIC has indeed been working with Citigroup to try to secure Wachovia for a much lower price than Wells was offering...and using taxpayer dollars to shore it all up.
Seems to me that Wells making this purchase (w/o taxpayer dollars) is a good thing.