esearch and Evaluate – WELLS FARGO/WACHOVIA
As a result of the financial crisis that rippled through the U.S. economy in 2008/2009, bank failure rates soared. The FDIC was able to identify many of the troubled banks, seize them and transfer their assets to healthy institutions successfully. However, the crisis did create a climate in which healthy banking institutions saw an opportunity to merge with and/or acquire competing banks. Like all well planned mergers, the acquiring bank realized that synergies would result by combining the assets and capabilities of the two institutions. One well publicized merger was the acquisition of Wachovia (well know in the Eastern US) by Wells Fargo Bank (a California based bank). Wells Fargo obviously saw many synergies and advantages in this acquisition.
- I would like you to do some research into this merger, determine as many facts as you can, and analyze the organizing activity involved in such an endeavor. You may not be able to locate all of the actions Wells Fargo intends to take to consolidate the two companies, but you should be able to uncover enough to put together a picture of what the new “Wells Fargo” might look like. Some research into past mergers/acquisitions may help you understand and predict some of the results of the plans of Wells Fargo.Use the resources found under the Research Toolbox button to help you conduct your research.
- Using this research and the organizing principles studied in the text, tell me how you believe Wells Fargo will begin to reorganize the “new” company, how it might look in 2-5 years, and if you think the merger was a good idea. In addition to presenting a picture of the “new” company indicate the good and bad results you can predict after the merger is completed and the “new” company has been up and running.
- I realize that this merger has already happened and many issues addressed but use this merger to answers the questions above as they would apply to all mergers and acquisitions.