Bye bye, Wachovia

by YES! Staff

Wachovoia Corp. will hold what is likely to be its last shareholders’ meeting on Dec. 23. And while the shareholders scream about the price of their stock — which cratered from about $55 two years ago to roughly $6 last week — and carp about Wells Fargo’s sweetheartdeal of an acquisition of the company, a once-beloved Triad-grown institution moves another step away from its history.

Wachovia’s roots lie with the Moravian settlers in Bethania and Salem, its name synonymous with their simple values and steely virtue. When the company moved its headquarters to the Forsyth County seat in 1879, Winston was one of the most bustling cities in the South. RJ Reynolds was importing so much Turkish tobacco and French paper that the city was designated a port despite being completely landlocked. Wachovia’s fortunes grew with the ascendancy of RJ Reynolds and it eventually became the world’s fourthlargest bank

Then Wachovia did what a lot of big banks were doing at the time: It swallowed up smaller banks. And though Wachovia towers helped define many downtown skylines — Atlanta, Birmingham, Philadelphia, Miami — it was still very much a North Carolina Piedmont company, with a strong presence throughout the Old North State. There are almost as many Wachovia branch banks in North Carolina as there are McDonald’s restaurants. The Triad alone has more than 100 of them, providing so many jobs, accounts and loans it is inextricably intertwined with our economy. It is a part of our culture, as well. Thousands of Wachovia employees fill downtown offices in our biggest cities, Greensboro and Winston-Salem chief among them, populating our restaurants, bars, galleries and theaters after work. And in downtown Charlotte, even as it’s in the throes of absorption, construction forges ahead on the company’s most ambitious tribute to itself at One Wachovia Center, the third-largest skyscraper in the city. It’s hard to look at this as anything but a takeover. As it stands, Wachovia shareholders will get 19 shares of Wells Fargo for every hundred Wachovia shares. The math bears out, but it should be considered that some North Carolinians who bought Wachovia stock did so with more than pure profit in mind. People stayed loyal to Wachovia in North Carolina because they believed the bank’s best interests were in line with their own. Perhaps that is no longer the case. An investor, Irving Ehrenhaus, is suing the company’s board of directors for abuse of the shareholders’ rights. At the Dec. 23 meeting, Wachovia shareholders will likely bring up the fact that Wachovia was neither insolvent nor bankrupt when it agreed to the sale. And then it will cast ballots on the acquisition by Wells Fargo, with the full knowledge that Wells Fargo, now owner of 40 percent of preferred Wachovia stock, gets a weighted vote in the matter.

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As it stands, Wachovia shareholders will get 19 shares of Wells Fargo for every hundred Wachovia shares.