The Five Dumbest Things on Wall Street This Week

5. Advo Cat Fight

Maybe Advo (AD Quote) and Valassis (VCI Quote) aren't such a good match after all.

Livonia, Mich.-based Valassis and Windsor, Conn.-based Advo agreed in July to a $1.3 billion merger creating the nation's biggest direct-advertising company.

"We are very pleased to welcome Advo into the Valassis family," Valassis chief Alan Schultz said July 6. "This is an exciting opportunity for employees, clients and shareholders."

The matchup has indeed become exciting, though probably not in the way the companies intended. Valassis last week sued Advo to break up the deal, claiming Advo misrepresented its financial health. Advo shares plunged.

Advo quickly issued a statement announcing that Valassis' claims "are nothing more than a case of 'buyer's remorse' arising from the negative reaction by Valassis' stockholders and analysts to the announcement of the transaction, and perhaps exacerbated by Valassis' own continuing financial weakness."

The companies have had little of substance to add since then, but they haven't let that stop them. On Wednesday, a Valassis press release mused, "What is Advo hiding?" Advo replied, "Advo rejects Valassis' invitation to litigate this case by press release."

Valassis, of course, didn't take the hint. Its press release Thursday screams, "Advo once again hides behind legalities." Heightening the suspense, Valassis then wonders, "When will we learn the truth?"

Not before about a hundred more posturing press releases, at this rate.

Dumb-o-Meter score: 82. With any luck, one side or the other will soon ask, "Who will tell the people?"

Editor's Note: Looking for the answers to last week's Five Dumbest Things on Wall Street quiz? Click here!