Under the Citigroup takeover, Wachovia shareholders would have gotten a pretty raw deal. The Wells Fargo acquisition (read the full text here) is an improvement: Each share of Wachovia common stock will be exchanged for 0.1991 shares of Wells Fargo common stock, which comes to a value of $7 per share (based on Wells Fargo's closing stock price of $35.16 a share on Thursday). The Citi deal would have paid $1 per share.
Here's what Wells Fargo's chairman, Richard Kovacevich, said in a statement: "This agreement is an outstanding opportunity for Wachovia common and preferred shareholders and debt holders, team members and customers, for the Charlotte and St. Louis communities and indeed all of the communities that Wachovia serves, and for the U.S. government and our banking system."
According to the Winston-Salem Journal, some shareholders are considering individual or class-action lawsuits based on statements made by Wachovia executives this year. One such is former CEO Ken Thompson's decree in January that Wachovia was not going to cut its dividend. Since then, the bank has cut its dividend twice, from 64 cents in February to 5 cents in July. One investor in the story, who has lost roughly $150,000 on Wachovia shares over the past year, said: "I bought 2,000 shares of Wachovia stock at $36 a share based on that statement because it helped restore my confidence in a Wachovia rebound."