by bintangkecil on Monday, October 6th, 2008 | Business, News

Oct. 6 (Bloomberg) — Citigroup Inc. sued Wells Fargo & Co. and its takeover target Wachovia Corp. for $60 billion, claiming their agreement violates its rights to buy a portion of the Charlotte, North Carolina-based lender under a previous deal.

Citigroup is seeking more than $20 billion in compensatory damages and $40 billion in punitive damages from the banks, their officers and directors, according to a complaint filed today in New York State Supreme Court in Manhattan.

“The Citi/Wachovia transaction would have been signed and announced on Friday, October 3rd if it had not been subverted by the unlawful conduct of Wachovia, Wells Fargo, and their officers and directors and outside advisers,” Citigroup said in a statement.

Citigroup seeks to complete its purchase as part of a rebuilding effort following $61 billion in losses tied to the mortgage-market collapse. The bank wants to buy parts of Wachovia for about $2.16 billion. San Francisco-based Wells Fargo’s $15 billion bid is for the whole company. Wachovia said the Wells Fargo offer is a better deal for investors, employees and taxpayers because, unlike Citigroup, it doesn’t rely on U.S. government assistance.

Wachovia spokeswoman Christy Phillips-Brown and Wells Fargo spokeswoman Melissa Murray declined to comment, saying the banks hadn’t seen the complaint.

Read more from Bloomberg.com

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Wells, Citi and regulators talked about splitting Wachovia - San Francisco Business Times

According to The Wall Street Journal, Citi and Wells Fargo would divide Wachovia’s 3,346 branches. Citi would take over Wachovia’s branches in the Northeast and mid-Atlantic, while Wells Fargo would take control of those in Southeast and California, the newspaper says. It cites individuals familiar with the discussions. Wells Fargo would also buy Wachovia’s asset-management and brokerage units, the Journal says.

Citigroup sues Wachovia, Wells Fargo for $60B - Forbes.com

The complaint seeks more than $20 billion in compensatory damages and more than $40 billion in punitive damages from Wells Fargo for tortious interference. Citigroup also seeks relief from Wachovia for its bad faith breach of the banks’ contract.

Citi Seeking At Least $60 Billion For Busted Wachovia Deal - CNN.com

Citi had reached an agreement in principle last Monday to buy Wachovia’s banking operations for $2.16 billion, but Wells Fargo swooped in and announced early Friday a $15.1 billion deal to buy all of Wachovia. Citi immediately cried foul, prompting Saturday’s suit.

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