per the Post Dispatch website this morning...this could be very, very bad for St. Louis.
Wells Fargo Advisors (formerly Wachovia/AG Edwards)
Wells Fargo Advisors (formerly Wachovia/AG Edwards)
May 31, 6:36 AM EDT
Wachovia to buy A.G. Edwards for $6.8B
NEW YORK (AP) -- Wachovia Corp. said Thursday it would acquire A.G. Edwards Inc. for $6.8 billion in cash and stock in a deal to form one of the largest retail stock brokerages in the United States.
Wachovia said A.G. Edwards shareholders would get 0.9844 Wachovia shares and $35.80 in cash for each A.G. Edwards share held. That offer values A.G. Edwards at $89.50 per share based on Wednesday's closing prices, a 16 percent premium.
The combined entity will have more than 3,300 brokerage locations nationwide, more than $1.1 trillion in client assets and nearly 15,000 financial advisers.
The deal is expected to close in the fourth quarter of 2007, with full integration by early 2009.
Wachovia said Daniel J. Ludeman, currently president and chief executive of its Wachovia Securities unit, will keep those roles at the combined brokerage unit. A.G. Edwards Chairman and CEO Robert Bagby will be chairman of the brokerage.
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Wachovia to buy A.G. Edwards for $6.8B
NEW YORK (AP) -- Wachovia Corp. said Thursday it would acquire A.G. Edwards Inc. for $6.8 billion in cash and stock in a deal to form one of the largest retail stock brokerages in the United States.
Wachovia said A.G. Edwards shareholders would get 0.9844 Wachovia shares and $35.80 in cash for each A.G. Edwards share held. That offer values A.G. Edwards at $89.50 per share based on Wednesday's closing prices, a 16 percent premium.
The combined entity will have more than 3,300 brokerage locations nationwide, more than $1.1 trillion in client assets and nearly 15,000 financial advisers.
The deal is expected to close in the fourth quarter of 2007, with full integration by early 2009.
Wachovia said Daniel J. Ludeman, currently president and chief executive of its Wachovia Securities unit, will keep those roles at the combined brokerage unit. A.G. Edwards Chairman and CEO Robert Bagby will be chairman of the brokerage.
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- 34
Anybody interested in a couple hundred thousand square feet of Class A office space on Jefferson Avenue? It'll be on the market real soon at dirt cheap prices. Maybe it can be converted to loft apartments.
Also, does St. Louis have direct flights to Charlotte, North Carolina?
Also, does St. Louis have direct flights to Charlotte, North Carolina?
The jury is still out on what Wachovia will do in St. Louis, but I personally don't think this bodes well for St. Louis. Maybe St. Louis will be the HQ for Wachovia Securities unit, but I doubt it. They may toss St. Louis a few bones.
Although AG Edwards is only a St. Louis F1000 company - any downsizing or relocations would hurt St. Louis' prowess in the brokerage/financial services sector.
Furthermore, even though Edwards has a lot of infrastructure in St. Louis, Wachovia has been building up its Charlotte instructure in a massive way. They have a HUGE tower planned in downtown Charlotte. AND Charlotte has been moving to become a financial hub in a major way for years. Charlotte-based BOA and Wachovia are among the largest financial institutions in America.
Also, there was a blurb about a week ago that AG Edwards, Raymond James (St. Pete, Florida), Piper Jaffray (Minneapolis) were all on the chopping block because of a changing industry.
The region and STATE better do what it can to SECURE the private Edward Jones.
Although AG Edwards is only a St. Louis F1000 company - any downsizing or relocations would hurt St. Louis' prowess in the brokerage/financial services sector.
Furthermore, even though Edwards has a lot of infrastructure in St. Louis, Wachovia has been building up its Charlotte instructure in a massive way. They have a HUGE tower planned in downtown Charlotte. AND Charlotte has been moving to become a financial hub in a major way for years. Charlotte-based BOA and Wachovia are among the largest financial institutions in America.
Also, there was a blurb about a week ago that AG Edwards, Raymond James (St. Pete, Florida), Piper Jaffray (Minneapolis) were all on the chopping block because of a changing industry.
The region and STATE better do what it can to SECURE the private Edward Jones.
- 835
From CNBC:
Wachovia said Thursday it will buy A.G. Edwards for about $6.8 billion in cash and stock, to create the second-largest retail brokerage in the United States.
The deal calls for the exchange of 0.9844 shares of Wachovia common stock and $35.80 in cash for each A.G. Edwards AG Edwards Inc (AGE), share. The deal represents a 16% premium to A.G. Edwards' closing share price Wednesday.
Wachovia Wachovia Corp (WB), the fourth-largest U.S. bank, will combine A.G. Edwards with its brokerage business, Wachovia Securities, pushing the company deeper into metropolitan areas.
The deal comes roughly seven months after Wachovia completed its $24.2 billion purchase of U.S. savings and loan company Golden West Financial Corp.
The combined retail brokerage will be based in St. Louis, home of A.G. Edwards, and will operate as Wachovia Securities.
It will have $1.1 trillion in client assets and nearly 15,000 financial advisors.
Wachovia Securities President and Chief Executive Daniel Ludeman will keep that role in the combined brokerage firm.
A.G. Edwards Chairman and CEO Robert Bagby will be chairman.
Bagby, reached at his St. Louis office, said he could not comment on the deal.
The combined organization should achieve expense efficiencies of $395 million after taxes by 2009, or 10 percent of its most recent fiscal year-end expense base, Wachovia said.
Wachovia expects to record merger-related and restructuring charges and exit cost purchase accounting adjustments of about $860 million after taxes in connection with the deal.
The Charlotte, North Carolina-based company said it expects the transaction to close in the fourth quarter of 2007, to add to earnings in the first full year following the closing and provide an internal rate of return of 24%.
Prudential Financial owns 38% of Wachovia Securities.
Before the deal was announced, A.G. Edwards shares were up 22% this year.
A.G. Edwards said in its latest proxy filing that its total shareholder return lagged the return of the Standard & Poor's stock index during the five-year period ended Feb. 28. But the brokerage said its shares outperformed a six-member peer group including Merrill Lynch Merrill Lynch & Co Inc (MER), the world's largest brokerage company; Charles Schwab Corp. and Morgan Stanley, posting a 71% return compared to the peer group's 27% gain during that period.
Albert G. Edwards, founder of the brokerage, was appointed by Abraham Lincoln as assistant secretary of the Treasury. He served in that position under five presidents until 1887, when he formed the firm with his son.
Wachovia Securities reports to David Carroll, president of Wachovia's Capital Management Group.
http://www.cnbc.com/id/18954724
Wachovia said Thursday it will buy A.G. Edwards for about $6.8 billion in cash and stock, to create the second-largest retail brokerage in the United States.
The deal calls for the exchange of 0.9844 shares of Wachovia common stock and $35.80 in cash for each A.G. Edwards AG Edwards Inc (AGE), share. The deal represents a 16% premium to A.G. Edwards' closing share price Wednesday.
Wachovia Wachovia Corp (WB), the fourth-largest U.S. bank, will combine A.G. Edwards with its brokerage business, Wachovia Securities, pushing the company deeper into metropolitan areas.
The deal comes roughly seven months after Wachovia completed its $24.2 billion purchase of U.S. savings and loan company Golden West Financial Corp.
The combined retail brokerage will be based in St. Louis, home of A.G. Edwards, and will operate as Wachovia Securities.
It will have $1.1 trillion in client assets and nearly 15,000 financial advisors.
Wachovia Securities President and Chief Executive Daniel Ludeman will keep that role in the combined brokerage firm.
A.G. Edwards Chairman and CEO Robert Bagby will be chairman.
Bagby, reached at his St. Louis office, said he could not comment on the deal.
The combined organization should achieve expense efficiencies of $395 million after taxes by 2009, or 10 percent of its most recent fiscal year-end expense base, Wachovia said.
Wachovia expects to record merger-related and restructuring charges and exit cost purchase accounting adjustments of about $860 million after taxes in connection with the deal.
The Charlotte, North Carolina-based company said it expects the transaction to close in the fourth quarter of 2007, to add to earnings in the first full year following the closing and provide an internal rate of return of 24%.
Prudential Financial owns 38% of Wachovia Securities.
Before the deal was announced, A.G. Edwards shares were up 22% this year.
A.G. Edwards said in its latest proxy filing that its total shareholder return lagged the return of the Standard & Poor's stock index during the five-year period ended Feb. 28. But the brokerage said its shares outperformed a six-member peer group including Merrill Lynch Merrill Lynch & Co Inc (MER), the world's largest brokerage company; Charles Schwab Corp. and Morgan Stanley, posting a 71% return compared to the peer group's 27% gain during that period.
Albert G. Edwards, founder of the brokerage, was appointed by Abraham Lincoln as assistant secretary of the Treasury. He served in that position under five presidents until 1887, when he formed the firm with his son.
Wachovia Securities reports to David Carroll, president of Wachovia's Capital Management Group.
http://www.cnbc.com/id/18954724
From STLtoday (AP):
Wachovia to buy A.G. Edwards for $6.8B
CHARLOTTE, N.C (AP) -- Wachovia, the nation's fourth-largest bank, said Thursday it would acquire A.G. Edwards for $6.8 billion in cash and stock in a deal to form the second-largest retail brokerage firm in the United States.
The combined brokerage unit will operate as Wachovia Securities, headquartered in St. Louis, and will have more than 3,300 brokerage locations nationwide, more than $1.1 trillion in client assets, and nearly 15,000 financial advisers.
Other A.G. Edwards businesses, including research, underwriting, investment banking, mutual funds and trust, will be consolidated into Wachovia's existing operating lines.
Wachovia Corp. said A.G. Edwards shareholders would get 0.9844 Wachovia shares and $35.80 in cash for each A.G. Edwards share held. That offer values A.G. Edwards Inc. at $89.50 per share based on Wednesday's closing prices, a 16 percent premium.
"The long-term growth opportunities of the brokerage industry are extremely compelling to Wachovia, and we have long expressed our interest in growing this business both organically and through acquisition," Ken Thompson, Wachovia's chairman and chief executive, said in a statement.
Wachovia shares fell 25 cents to $54.30 in premarket trading. A.G. Edwards shares were up $10.75, or nearly 14 percent, to $87.90.
The deal continues a string of high-profile acquisitions engineered by Charlotte, N.C.-based Wachovia, including First Union, Prudential Securities and, most recently, Golden West Financial Corp.
The transaction, which is expected to close in the fourth quarter of 2007, with full integration by early 2009, makes Wachovia the second-largest American retail brokerage, after Merrill Lynch & Co. Inc., and propels Wachovia past Citigroup Inc.'s Smith Barney.
"While Wachovia has made strides to be among the top retail brokerages with its acquisition of the Prudential brokerage operation, it was never considered in the big leagues with Merrill Lynch, Smith Barney & Morgan Stanley," said Robert Ellis, senior analyst at Celent, a Boston-based financial research and consulting firm. "So, like most acquisitions, this one has an aspect of ego attached."
Wachovia said Daniel J. Ludeman, currently president and chief executive of its Wachovia Securities unit, will keep those roles at the combined brokerage unit. A.G. Edwards Chairman and CEO Robert Bagby will be chairman of the brokerage.
http://hosted.ap.org/dynamic/stories/W/ ... TE=DEFAULT
Wachovia to buy A.G. Edwards for $6.8B
CHARLOTTE, N.C (AP) -- Wachovia, the nation's fourth-largest bank, said Thursday it would acquire A.G. Edwards for $6.8 billion in cash and stock in a deal to form the second-largest retail brokerage firm in the United States.
The combined brokerage unit will operate as Wachovia Securities, headquartered in St. Louis, and will have more than 3,300 brokerage locations nationwide, more than $1.1 trillion in client assets, and nearly 15,000 financial advisers.
Other A.G. Edwards businesses, including research, underwriting, investment banking, mutual funds and trust, will be consolidated into Wachovia's existing operating lines.
Wachovia Corp. said A.G. Edwards shareholders would get 0.9844 Wachovia shares and $35.80 in cash for each A.G. Edwards share held. That offer values A.G. Edwards Inc. at $89.50 per share based on Wednesday's closing prices, a 16 percent premium.
"The long-term growth opportunities of the brokerage industry are extremely compelling to Wachovia, and we have long expressed our interest in growing this business both organically and through acquisition," Ken Thompson, Wachovia's chairman and chief executive, said in a statement.
Wachovia shares fell 25 cents to $54.30 in premarket trading. A.G. Edwards shares were up $10.75, or nearly 14 percent, to $87.90.
The deal continues a string of high-profile acquisitions engineered by Charlotte, N.C.-based Wachovia, including First Union, Prudential Securities and, most recently, Golden West Financial Corp.
The transaction, which is expected to close in the fourth quarter of 2007, with full integration by early 2009, makes Wachovia the second-largest American retail brokerage, after Merrill Lynch & Co. Inc., and propels Wachovia past Citigroup Inc.'s Smith Barney.
"While Wachovia has made strides to be among the top retail brokerages with its acquisition of the Prudential brokerage operation, it was never considered in the big leagues with Merrill Lynch, Smith Barney & Morgan Stanley," said Robert Ellis, senior analyst at Celent, a Boston-based financial research and consulting firm. "So, like most acquisitions, this one has an aspect of ego attached."
Wachovia said Daniel J. Ludeman, currently president and chief executive of its Wachovia Securities unit, will keep those roles at the combined brokerage unit. A.G. Edwards Chairman and CEO Robert Bagby will be chairman of the brokerage.
http://hosted.ap.org/dynamic/stories/W/ ... TE=DEFAULT
Okay, I just saw it on CNBC as well. Great, great news for St. Louis!
Although St. Louis loses a F1000, it gains a really HUGE unit. It's great for St. Louis to be on the positive end for a change. With this news, it's likely that new development (campus expansion) will happen in the future as well.
I initially had my reservations because Wachovia is building a new 49-story tower in Charlotte.
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Although St. Louis loses a F1000, it gains a really HUGE unit. It's great for St. Louis to be on the positive end for a change. With this news, it's likely that new development (campus expansion) will happen in the future as well.
I initially had my reservations because Wachovia is building a new 49-story tower in Charlotte.
Wow, that will be fantastic news if true! I can't find that repeated anywhere else, but I doubt CNBC would post it without reason.
So I guess this means that the securities portion of Wachovia is merging with A.G. Edwards? So STL would probably get a "Wachovia Securities" where as the banking portion would remain in Charlotte?
Also, perhaps this is the big news for downtown this week - maybe they are planning a new tower from MW.
So I guess this means that the securities portion of Wachovia is merging with A.G. Edwards? So STL would probably get a "Wachovia Securities" where as the banking portion would remain in Charlotte?
Also, perhaps this is the big news for downtown this week - maybe they are planning a new tower from MW.
^Maybe this is a bit premature, but it would be great if Wachovia Securities had a division to anchor a new building (like the MW Tower) downtown versus expanding the AG Edwards campus.
- 10K
I hope that the employees laid off due to any redundancies caused by this deal are based in Charlotte and not STL. I was once a victim of downsizing from the Bank of America/NationsBank - Boatmen's merger, and it wasn't fun. Our entire department was eliminated and our work was given to people in Charlotte.
- 622
It was mentioned on the Wachovia press release as well that the combined retail brokerage operation will be based in St. Louis.
Obviously more info will come out soon. Keep our fingers crossed.
Obviously more info will come out soon. Keep our fingers crossed.
It felt like a punch in the stomach when I first heard the news this morning. Reading all of the above helps. Keeping my fingers crossed, not much else we can do.
- 11K
In case anyone was worried that the local news would try to find a positive spin (from the PD blog):
Another local HQ bites the dust; what’s that mean for St. Louis?
Another local HQ bites the dust; what’s that mean for St. Louis?
From the business journal...
The combined retail brokerage organization will be headquartered in St. Louis. Other A.G. Edwards businesses -- including research, underwriting and investment banking, mutual funds and trust -- will be consolidated into the appropriate Wachovia lines of business. The merger is expected to be completed in the fourth quarter, and integration is to be completed by the end of the first quarter of 2009.
I wonder if Wachovia will transfer AG's Investment Banking operations to Charlotte?
The article mentions the retail side in great detail but only mentions that the IB will be consolidated, which means that there might be layoffs/transfers.
The article mentions the retail side in great detail but only mentions that the IB will be consolidated, which means that there might be layoffs/transfers.
Grover wrote:In case anyone was worried that the local news would try to find a positive spin (from the PD blog):
Another local HQ bites the dust; what’s that mean for St. Louis?
Even if St. Louis had been left with barebones, I submit life goes on. Cities are losing HQ's all over the nation because of mergers, acquisitions etc.
It happens. Yet, other local firms are growing. If there were none in the pipeline then there'd be cause for alarm.
Again, St. Louis is gaining a gem according to the reports posted by Jive and the report I saw on CNBC. It's larger than AG Edwards could ever grow.
How big is Edwards' IB operation - job wise?St.Louis UAB alumni wrote:I wonder if Wachovia will transfer AG's Investment Banking operations to Charlotte?
It's not that big.
I know a guy that just got hired in their IB division so I'll ask him what the outlook is for their STL operations.
Most IB's have multiple locations anyway w/ the bulk of the IB employees being at the HQ. Maybe the AG guys can get lucky and stay in STL. Despite that, I guarantee they'll be getting paid more now because their bonus pool is going to get much, much larger.
I know a guy that just got hired in their IB division so I'll ask him what the outlook is for their STL operations.
Most IB's have multiple locations anyway w/ the bulk of the IB employees being at the HQ. Maybe the AG guys can get lucky and stay in STL. Despite that, I guarantee they'll be getting paid more now because their bonus pool is going to get much, much larger.
CNBC is now saying that St. Louis-based Stifel Financial (which doesn't trade publicly) and other national brokerages including Jefferies and Raymond James could be the next targets.
- 10K
Stifel is publicly-traded. I seriously doubt that it's a takeover candidate though for several reasons, including its extremely high percentage of employee ownership. Raymond James, on the other hand, is very similar to A.G. Edwards, and I wouldn't be surprised if it's the best candidate for a purchase.
^You know, I thought Stifel was publicly-traded because it is on St. Louis' Index list of publicly-traded firms, but CNBC said otherwise. Don't know why.
- 10K
Yeah, it trades under the symbol "SF." The stock is way up this morning - over 8%.
A gloomy comment from the P-D forums:
I have news for the poster.....There will be more so brace yourself. Anwyay, with Wachovia having a MAJOR division here, I just don't see this as all bad news. Again, AG Edwards, while a long time institution in St. Louis, was not a F500 company - like May, like Ralston, like SBC, like McDonnell-Douglas. Not that a F1000 loss isn't big, because it is.
But while it is not totally good news, it is not totally bad news either. St. Louis could have been left with a skeleton or shell of a campus. AND there's a good chance for more jobs.
We'll see.
"Sad to see St. Louis loose another corporate HQ. Seems that the St. Louis area is on the decline and its happening way too fast. The once proud St. Louis is now nothing more then a 2nd rate back office processing center for Mega-Companies. How sad is that! Where will the good jobs of the future come from. The Gateway to the west is not the Gateway to no Public Corporate HQ’s. It began with Southwestern Bell back in the 80’s and continues today. Thank G-D for companies like Enterprise Rent a Car as they are one of the few bright spots left in our town."
I have news for the poster.....There will be more so brace yourself. Anwyay, with Wachovia having a MAJOR division here, I just don't see this as all bad news. Again, AG Edwards, while a long time institution in St. Louis, was not a F500 company - like May, like Ralston, like SBC, like McDonnell-Douglas. Not that a F1000 loss isn't big, because it is.
But while it is not totally good news, it is not totally bad news either. St. Louis could have been left with a skeleton or shell of a campus. AND there's a good chance for more jobs.
We'll see.