Citi Drops Wachovia Talks, Will Still Sue for Damages

By John Johnson,  Newser Staff
Posted Oct 9, 2008 5:23 PM CDT
A Wachovia branch office in New York City.   (AP Photo)
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(Newser) – Citigroup said today it's going to let Wells Fargo go ahead with its acquisition of Wachovia, the Wall Street Journal reports. But all's not chummy in the banking world: Citigroup, which charges that Wachovia illegally backed out of a deal to accept a sweeter offer from Wells Fargo, is still going to sue for billions in damages.

The banks had tried to hammer out an agreement, but Citigroup ended those talks today. "Dramatic differences in the parties' transaction structures and their views of the risks involved made it impossible to reach a mutually acceptable agreement," it said. Wachovia has agreed to sell its operations to Wells Fargo for $15.1 billion.