Wachovia`s Board of Directors rejected SunTrust`s offer and supported the merger with First Union. SunTrust continued its hostile takeover attempt and resulted in a fierce battle this summer between SunTrust and First Union.  The two banks increased their bids for Wachovia, received newspaper advertisements, sent letters to shareholders and initiated legal disputes to challenge each other`s takeover bids.  On August 3, 2001, wachovia shareholders approved the first union agreement and rejected SunTrust`s attempts to elect a new board of directors for Wachovia and terminated SunTrust`s hostile acquisition attempt.  As part of the agreement, Wells Fargo will acquire all of Wachovia`s outstanding common shares as part of a stock transaction. As part of the transaction, Wells Fargo will acquire all business lines and commitments of Wachovia Corporation, including its preferred capital and debt, as well as all bank deposits. Wells Fargo – Company is a diversified financial services company with a fortune of $609 billion that provides banks, insurance, investments, mortgages and consumer financing across nearly 6,000 stores and the Internet (wellsfargo.com) in North America and internationally. Wells Fargo Bank, N.A. is the only bank in the United States and one of two banks in the world, both Moody`s Investors Service, Aaa, and Standard and Poor`s Ratings Services, “AAA,” which has the highest possible credit rating. Kovacevich said, “This agreement is an excellent opportunity for Wachovia`s preferred shareholders and debtors, team members and customers, for the municipalities of Charlotte and St. Louis and, in fact, for all the municipalities that serve Wachovia, and for the U.S.
government and our banking system. It is a business model and strategically compelling, and it is simply an incredible adjustment that will lead to a very strong and stable financial services company that will continue Wachovia`s proud tradition of being one of the best financial institutions in the world. The company`s major mergers and acquisitions and its historical predecessors (until the merger between Wachovia and First Union in 2001) are shown below. The list is not complete. Fearing that the competing rights of Citigroup and Wells Fargo would themselves become a destabilizing influence on these institutions, Wachovia and the banking system in general, Federal Reserve officials sought to facilitate negotiations between Wachovia, Citigroup and Wells Fargo to resolve their disputes. In order to allow time for these discussions, Federal Reserve officials were involved in facilitating ceasefire negotiations or halting disputes between the three companies. On October 6, a status quo agreement was reached, in which LaWachovia, Citigroup and Wells Fargo agreed to suspend for two days all formal activities of the trial, including discovery, and to cooperate in another way to maintain the litigation status quo. The agreement was extended until 10 October. Citigroup reviewed their legal options and asked Wachovia and Wells Fargo to end talks and said Wells Fargo was interfering in an exclusive agreement between Citigroup and Wachovia. This agreement states in part that “until October 6, 2008, Wachovia has neither its subsidiaries nor any of its respective senior executives, directors […] […] Take steps to facilitate or encourage the filing of an acquisition proposal.   The day after WaMu`s failure, Wachovia Bank depositors accelerated the withdrawal of large amounts from their accounts.