Wells Fargo agrees to buy Wachovia, Citi objects

BY SARA LEPRO
Associated Press

NEW YORK October 03, 2008 12:47 pm

— Wachovia says it agreed to be acquired by San Francisco-based Wells Fargo & Co. in a $15.1 billion all-stock deal. But Citigroup now demands that Wachovia abide by the terms of its earlier deal to buy Wachovia's banking operations.
The clash sets up a battle over who will win Charlotte, N.C.-based Wachovia.
The Citigroup deal would have been done with the help of the Federal Deposit Insurance Corp., but the Wells deal would be done without it. The head of the FDIC said the agency is standing behind the agreement it made with Citigroup.
Citigroup says its agreement with Wachovia provides that Wachovia will not enter into any transaction with any party other than Citi or negotiate with anyone else.
Wells Fargo employs about 12,900 people in Iowa, most of them in the Des Moines area, where it operates its retail home mortgage business.