Wells Fargo and Wachovia Going Ahead with Merger
Citigroup has decided to walk away from negotiations with Wells Fargo over Wachovia's future. Wachovia says the merger with Wells Fargo is in the best interest of its shareholders and employees. Tony Plath, an economist at UNC predicts job losses to total at most 10-percent of the combined company. "So this is a much, much smaller impact on the local and regional economy than what we would have seen had Citi carried the day," Plath said. Wells Fargo has agreed to buy all of Wachovia for $11.7 billion without help from the government. That's lower than the original offer because Wells Fargo stock has dipped in the past week. That deal was struck a few days after Citigroup offered to buy a large portion of the Charlotte bank for $2.2 billion with financial backing from the FDIC. Citigroup says it won't block the Wells Fargo deal, but is seeking $60 billion in damages for breach of contract.