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CHARLOTTE, NC-In a surprising move ending a tumultuous week, locally based Wachovia Corp. has agreed to be purchased by San Francisco-based Wells Fargo & Co. for $15.1 billion. The deal, approved by both banks' boards Thursday night, negates the need for a pending takeover by New York City-based Citigroup Inc. that was arranged by the FDIC over the past weekend and would have included a $42-billion bailout of Wachovia's loan losses.

"This deal enables us to keep Wachovia intact and preserve the value of an integrated company, without government support," Wachovia Chairman and CEO Bob Steel said in a statement issued early Friday morning. "The market presence and composition of our businesses, along with our service-oriented cultures, are extraordinarily complementary and this combination creates great potential for sustained stability and growth."

Wachovia and Wells Fargo have an almost equal number of offices across the US, with more than 10,000 combined, though there is little overlap in their territories, with Wachovia dotting the eastern landscape while Wells Fargo is primarily a western bank. Some redundancy could occur in Texas and California, where Wachovia absorbed hundreds of branches in previous bank buyouts over the past several years.

Wells Fargo's offer amounts to $7 per share to Wachovia stockholders, far better than the FDIC-arranged Citi deal amounting to little more than a dollar each. Wells Fargo had been the only other US-based bank bidding for Wachovia when talk of a possible takeover began last Friday.

Wachovia's headquarters in Charlotte will remain in place as an East Coast operations base for the combined company's retail, commercial and corporate banking business; St. Louis will remain as the headquarters for Wachovia Securities; and three of Wachovia's executives will join Wells Fargo's board. The combined assets of the bank will exceed $1.4 trillion.

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Wachovia, Wells Fargo Agree to Merge

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