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Citigroup, Wells Fargo agree on 44-hr truce

Source: PTI
October 07, 2008 11:36 IST
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Citigroup Inc and Wells Fargo and Co agreed on Monday on a 44-hour truce in fight over acquiring Wachovia to give negotiators time to sort out the issues and reach a compromise.

This effectively freezes the legal fight in the courts until Wednesday noon (2130 IST) following Wells Fargo and Wachovia announcement of $15 billion deal which bested the earlier deal with Citibank.

Meanwhile, the Wall Street Journal said discussions to resolve the mess are continuing, with the most likely scenario resulting in Citigroup buying branches from Wachovia in the Northeast and mid-Atlantic region.

Wells Fargo, of San Francisco, would get Wachovia branches in the Southeast and California, it said quoting people familiar with the situation.

Reports said that Citigroup which had offered to buy its banking assets for $2.2 billion might be consider buying the entire operations of Wachovia but it would not like to buy without some government guarantee. Wells Fargo had offered to buy it of its own.

The government is not directly involved in the negotiations which were said to be proceeding slowly but is keen for an early settlement especially in view of the continuing decline in the stock market as it could, the Journal said, unnerve investors and customers.

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