Court Upholds Wachovia-First Union Merger
Updated from 12:42 p.m. EDT:
As part of their friendly merger agreement announced in mid-April, Wachovia and First Union agreed to a breakup provision that would allow First Union to acquire a 19.9% stake in Wachovia, valued at up to $780 million, if the deal did not go through. SunTrust charged that the breakup provision attempted to coerce Wachovia shareholders into voting for the First Union merger. But North Carolina Judge Ben Tennille rejected that argument, saying the court was convinced Wachovia shareholders could make an "uncoerced, fully informed decision" about how to vote.
However, the court did approve a motion by SunTrust to invalidate a nontermination provision that essentially would have barred another company from making an unsolicited bid for Wachovia before January 2002. This helps SunTrust some; if Wachovia does vote against a First Union merger at its shareholder meeting on Aug. 3, it will allow SunTrust to move forward with its hostile bid.First Union agreed to acquire Wachovia this spring in a stock swap valued at about $14 billion.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV