A New York State Supreme Court judge has agreed to impose a temporary injunction to block the announced sale of Wachovia to Wells Fargo. Citigroup, which originally agreed to purchase the troubled bank, said it would do all it could to prevent the deal from going through.
Days after Citigroup agreed to a deal, Wachovia reversed course and to a sale to Wells Fargo for $14.8 billion.
Justice Charles Ramos granted the relief over the objection of Wachovia. Citigroup said it is prepared to continue negotiations with Wachovia on the parties' previously agreed-to transaction.
Citigroup says its Exclusivity Agreement, while in effect, unconditionally bars Wachovia from negotiating or entering into a merger/acquisition agreement with any party other than Citi.
Under the Judicial Order, Citigroup and Wachovia must appear before Judge Ramos on Friday, October 10, 2008. Citi said it has made clear it is prepared to resume negotiating announced an agreement-in-principle in good faith to complete the transaction contemplated by the agreement-in-principle that Citi and Wachovia announced on Monday, September 29, 2008.
On September 29th, Citi and Wachovia both for Citi to acquire all of the banking subsidiaries of Wachovia. At the time the Wachovia/Wells Fargo transaction was announced, Citi was finalizing the agreements required to consummate its FDIC-assisted open bank transaction with Wachovia.
Citi said it has been providing liquidity support to Wachovia since the day of the announcement.
