Fed Greenlights PNC-Nat City Merger

The Federal Reserve on Monday approved PNC Financial Services' (PNC Quote) acquisition of National City (NCC Quote).

Pittsburgh-based PNC announced on Oct. 24 it would sell $7.7 billion of preferred shares and warrants to the government to finance its buyout of Cleveland-based National City. The government money came from the Troubled Asset Relief Program (TARP), a $700 billion pool set up in October to aid financial institutions struggling with the credit crisis.

PNC said it would buy National City for $2.23 a share, or a fixed amount of roughly $5.2 billion in PNC stock, while paying an additional $384 million to certain warrant holders. ...