Citigroup to seek billions against Wells Fargo for Breach of Contract
October 10, 2008
New York - Citigroup plans to seek $60 billion in damages for breach of contract against Wells Fargo & Co., saying that the company violated an exclusivity agreement it had with Wachovia.
The company charges that Wells Fargo committed a breach of contract when an agreement in buying the Wachovia’s banking operations by an $11.7 billion stock offer was made, after Citigroup agreed to buy the said banking operations the previous week for $2.1 billion in a deal that is brokered by the Federal Deposit Insurance Corp.
While Citigroup decided not challenge the Federal antitrust regulators decision clearing Wells Fargo’s $11.7 million acquisition of the bank, the company seeks get hold of the said amount for damages.
San Francisco-based Wells and Fargo will go on with the purchase, preparing to complete the deal by the end of fourth quarter.
Wells Fargo shares increased by $1.06 or 3.9 percent, to $28.31. While Citigroup shares increased by $1.18 or 9.1 percent to $14.11 and Wachovia shares increased by $1.55 or 43 percent, to $5.15.