Citigroup Secures NY Court Order To Temporarily Block Wachovia-Wells Fargo Deal

New York, NY (AHN) - Citigroup Inc. (NYSE: C) announced late Saturday that it has secured an order from a New York state court judge to temporarily block Wells Fargo & Co. (NYSE: WFC) acquiring Wachovia Corp. (NYSE: WB), leading the banks to use court to resolve the issue.

Citi said in a statement that it was granted "emergency injunctive relief extending the Exclusivity Agreement between Citi and Wachovia until further order of the court."

"This relief was granted over the objection of Wachovia. Justice Charles Ramos of the Supreme Court of the State of New York issued the order," it added.

Last week, Citigroup had turned furious after Wachovia dumped it and decided to merge with Wells Fargo at a price of $15.1 billion in an all- stock transaction.

Citigroup had said that the firms cannot make a deal as Wachovia will be in a clear breach of an Exclusivity Agreement, which the Charlotte, North Carolina-based Wachovia had signed with the New York-based financial firm early last week.

The brokerage firm was all set to purchase Wachovia's banking operations with additional support from the Federal Deposit Insurance Corp. (FDIC), who also appeared to be taken off guard with Wachovia's early Friday's news.

Citigroup said that under the Judicial Order, the firm along with Wachovia will appear before Judge Ramos on October 10, 2008.

"Citi has made clear it is prepared to resume negotiating in good faith to complete the transaction contemplated by the agreement-in-principle that Citi and Wachovia announced on September 29, 2008," the firm said in the statement.

Citigroup has been providing liquidity support to Wachovia since the day of the announcement, according to the statement.