SCHEDULE 14A
(Rule 14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No.)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary proxy statement.
[ ] Confidential, for use of the commission only (as permitted by Rule
14a-6(e)(2)).
[ ] Definitive proxy statement.
[ ] Definitive additional materials.
[X] Soliciting material under Rule 14a-12.
Wachovia Corporation
(Name of Registrant as Specified in Its Charter)
N/A
(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of filing fee (check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on
which the filing fee is calculated and state how it was
determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
Date: June 28, 2001
This filing contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Such statements include, but
are not limited to, (i) statements about the benefits of the merger between
Wachovia Corporation and First Union Corporation, including future financial and
operating results, cost savings, enhanced revenues, and accretion to reported
earnings that may be realized from the merger; (ii) statements with respect to
Wachovia's and First Union's plans, objectives, expectations and intentions and
other statements that are not historical facts; and (iii) other statements
identified by words such as "believes", "expects", "anticipates", "estimates",
"intends", "plans", "targets", "projects" and similar expressions. These
statements are based upon the current beliefs and expectations of Wachovia's and
First Union's management and are subject to significant risks and uncertainties.
Actual results may differ from those set forth in the forward-looking
statements.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectations expressed in the
forward-looking statements: (1) the risk that the businesses of First Union and
Wachovia will not be integrated successfully or such integration may be more
difficult, time-consuming or costly than expected; (2) expected revenue
synergies and cost savings from the merger may not be fully realized or realized
within the expected time frame; (3) revenues following the merger may be lower
than expected; (4) deposit attrition, operating costs, customer loss and
business disruption following the merger, including, without limitation,
difficulties in maintaining relationships with employees, may be greater than
expected; (5) the ability to obtain governmental approvals of the merger on the
proposed terms and schedule; (6) the failure of Wachovia's and First Union's
stockholders to approve the merger; (7) competitive pressures among depository
and other financial institutions may increase significantly and have an effect
on pricing, spending, third-party relationships and revenues; (8) the strength
of the United States economy in general and the strength of the local economies
in which the combined company will conduct operations may be different than
expected resulting in, among other things, a deterioration in credit quality or
a reduced demand for credit, including the resultant effect on the combined
company's loan portfolio and allowance for loan losses; (9) changes in the U.S.
and foreign legal and regulatory framework; and (10) adverse conditions in the
stock market, the public debt market and other capital markets (including
changes in interest rate conditions) and the impact of such conditions on the
combined company's capital markets and asset management activities. Additional
factors that could cause Wachovia's and First Union's results to differ
materially from those described in the forward-looking statements can be found
in Wachovia's and First Union's reports (such as Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed with the
Securities and Exchange Commission and available at the SEC's Internet site
(http://www.sec.gov). All subsequent written and oral forward-looking statements
concerning the proposed transaction or other matters attributable to Wachovia or
First Union or any person acting on their behalf are expressly qualified in
their entirety by the cautionary statements above. Wachovia and First Union do
not undertake any obligation to update any forward-looking statement to reflect
circumstances or events that occur after the date the forward-looking statements
are made.
The proposed transaction will be submitted to Wachovia's and First Union's
stockholders for their consideration, and on June 27, 2001 First Union filed an
amended registration statement on Form S-4 with the SEC containing a preliminary
joint proxy statement/prospectus of Wachovia and First Union and other relevant
documents concerning the proposed transaction. Stockholders are urged to read
the definitive joint proxy statement/prospectus when it becomes available, and
any other relevant documents filed with the SEC, as well as any amendments or
supplements to those documents, because they will contain important information.
You will be able to obtain a free copy of the registration statement and the
joint proxy statement/prospectus, as well as other filings containing
information about Wachovia and First Union, at the SEC's Internet site
(http://www.sec.gov). Copies of the joint proxy statement/prospectus and the SEC
filings that will be incorporated by reference in the joint proxy
statement/prospectus can also be obtained, without charge, by directing a
request to Wachovia, Investor Relations, 100 North Main Street, Winston-Salem,
North Carolina 27150 (888-492-6397), or to First Union, Investor Relations, One
First Union Center, Charlotte, North Carolina 28288-0206 (704-374-6782).
Wachovia and First Union, and their respective directors and executive officers
may be deemed to be participants in the solicitation of proxies from the
stockholders of Wachovia and First Union in connection with the merger.
Information about the directors and executive officers of Wachovia and their
ownership of Wachovia common stock is set forth in Wachovia's proxy statement on
Schedule 14A, as filed with the SEC on March 19, 2001. Information about the
directors and executive officers of First Union and their ownership of First
Union common stock is set forth in First Union's proxy statement on Schedule
14A, as filed with the SEC on March 13, 2001. Additional information regarding
the interests of those participants may be obtained by reading the definitive
joint proxy statement/prospectus regarding the proposed transaction when it
becomes available.
LETTER TO BE MAILED TO WACHOVIA SHAREHOLDERS WITH THE PROXY PACKAGE RELATED TO
THE PROPOSED MERGER WITH FIRST UNION
[LETTERHEAD]
June 27, 2001
Dear Fellow Wachovia Shareholder:
We believe Wachovia and First Union together will be a great company. The merger
allows us to build the new Wachovia on traditional Wachovia values: trust,
integrity, personal relationships, reliability, and superior customer service.
We strongly believe that together our earnings will grow faster than Wachovia by
itself. We encourage you to read the enclosed proxy materials carefully and then
to vote FOR our merger with First Union on the enclosed WHITE proxy card.
As you may know, SunTrust has made a hostile takeover proposal to acquire
Wachovia. You may have already received proxy material and a blue proxy card
from SunTrust asking you to vote against our merger.
We are confident that the combination with First Union will provide
substantially more earnings and growth potential than an acquisition by
SunTrust. Please do not vote on SunTrust's card.
Once you have read the proxy materials carefully, we think you will be
convinced, as we are, that the new Wachovia formed by our merger of equals with
First Union will create:
superior value for shareholders through superior growth
potential
a leading financial institution well-positioned to serve our
customers and communities
All we need is your support. We urge you to vote FOR the merger.
We believe the new Wachovia will provide superior earnings growth.
Let's look at how fast we expect your earnings per share to grow with the
Wachovia and First Union merger of equals compared with the hostile SunTrust
proposal:
[Graph appears here]
The New
Wachovia SunTrust
2002 9.1% -8.8%
2003 12.8% -2.6%
2004 16.6% 2.9%
We believe, based on our cost savings forecasts and projections by analysts,
that our merger with First Union means earnings per share for Wachovia
shareholders will grow more than 9 percent faster than Wachovia alone in 2002.
Under SunTrust's proposal, SunTrust itself projects your earnings per share will
be almost 9 percent lower than Wachovia alone in 2002.
You can see from the chart that the upside growth potential for you, a Wachovia
shareholder, is much greater with First Union.
You can receive your same Wachovia dividend rate.
Under the First Union merger, you can either receive a regular annual dividend
of $2.40 -- the same dividend as you currently enjoy -- or you can elect to
receive a special 48 cents cash payment in the merger along with a $1.92
dividend, depending on what is best for you:
1. You can elect to receive a preferred security which, together with your
common stock, will provide you with the same $2.40 annual dividend that you
get now until the annual dividend rate of the new Wachovia rises to $2.40 for
the two shares of Wachovia common stock you will receive. Then you'll get the
regular dividend of the new Wachovia; or
2. You can receive a special one-time cash payment of 48 cents per share in the
merger. Then you can receive the regular new Wachovia common stock dividend,
which will start at $1.92 per year, for the two shares of new Wachovia common
stock you will receive.
The Wachovia/First Union merger of equals is on track
as planned to create the new Wachovia.
The merger agreement is signed. Regulatory approvals are on track.
Key managers have been selected. Integration planning is well underway.
Hart-Scott-Rodino anti-trust clearance has already been received.
Once the First Union merger is approved, and with much of the integration
planning already completed, we can move swiftly to realize the benefits of our
merger with First Union.
Just last week, Wachovia and First Union received Hart-Scott-Rodino anti-trust
clearance from the U.S. Federal Trade Commission. This important approval brings
us one step closer to completion.
In contrast, SunTrust hasn't actually made an offer. Rather, SunTrust hopes it
can persuade you to reject the First Union merger and then, at some uncertain
time in the future, it will try to take over Wachovia on its own terms. There is
absolutely no certainty that such a transaction will ever result, or that its
terms will be attractive to you or other shareholders.
The value of SunTrust's proposal has dropped dramatically.
When SunTrust first announced its hostile takeover proposal, its value was
nearly 16 percent higher than Wachovia's planned merger with First Union. Since
then, the implied premium has all but disappeared. Let's look at the SunTrust
disappearing "premium."
[Graph appears here]
Day Before SunTrust's Announcemnt
May 11 15.8%
June 25 2.0%
We believe SunTrust's "premium" has all but disappeared because investors
believe that the prospects are unattractive for SunTrust if it continues on its
present course.
In our view, SunTrust's hostile takeover attempt is an act born of desperation
that is more about preventing the formation of a formidable competitor -- the
new Wachovia -- than about creating value for Wachovia shareholders.
The market sees what we like about First Union.
When we began talks with First Union in earnest in April, an intensive
examination of its businesses showed us a genuine turnaround and the
revitalization of the company. In our view, the performance of First Union's
shares this year suggests that investors agree with our conclusion.
Year to Date Price Performance
(Through June 25, 2001)
[Graph appears here]
First Union 24%
SunTrust 4%
We are excited about creating the new Wachovia and we need your support to make
it happen. Since we need a majority of all shares outstanding, your vote is very
important no matter how many shares you own. Please vote FOR the merger of
Wachovia and First Union today on the enclosed WHITE proxy card.
Please vote. If you do not vote, it is the same as voting against the merger.
Please vote today FOR the merger on the WHITE proxy card enclosed.
If you have any questions, please call our proxy solicitors or our Special
Shareholder Hotline. Their telephone numbers are listed on the reverse side.
Thank you for your continued support.
On behalf of the Board of Directors
Sincerely,
L.M. BAKER, JR.
Chairman and Chief Executive Officer
Our merger of equals with First Union is a thoughtful, responsible strategic
combination designed to give Wachovia shareholders the potential for superior
earnings growth and the same strong Wachovia dividend. In short, we believe our
merger with First Union will offer the best value for Wachovia shareholders. But
don't just take our word for it, read what the experts are saying about the
Wachovia/First Union merger.
"Why I favor First Union/Wachovia . . . 1) It's friendly . . . 2) First
Union/Wachovia would have a better business mix . . . 3) The cost savings
potential in a First Union/Wachovia combination is greater than in a
SunTrust/Wachovia combination . . . 4) First Union would handle the integration
of Wachovia better than SunTrust . . . 5) There is more upside in First Union's
stock."
-- Second Curve Capital: Tom Brown (Bankstocks.com), June 4, 2001
"We now believe that the First Union merger with Wachovia ought to prevail . . .
as the premium of SunTrust's offer has declined the deal becomes less about
top-price and more about the currency of the acquirer. To that end, we believe
First Union will offer better returns.
"SunTrust/Wachovia -- A limited ability to grow . . . As such, like so many
other banking mergers, this combination would revolve around cost savings as a
means to drive the bottom line in the short run and as capital builds, share
repurchases would then contribute to EPS growth. This is not a scenario that
drives significant multiple expansion, in our view . . ."
-- Deutsche Banc Alex. Brown Inc.: G. Bicher, May 25, 2001
"Wachovia's argument that First Union has superior technology, a wider product
breadth, and greater experience in merging institutions is correct. It does seem
likely that a Wachovia/First Union combination would generate higher cash flows
at a more rapid rate."
-- Raymond James & Associates: Richard X. Bove, May 23, 2001
"At the risk of appearing glib, perhaps the two companies' [Wachovia and
SunTrust] opposing views as to whether they got along or not is symptomatic of
the issues Wachovia is raising. We would agree that, in looking to combine two
companies of some size, management "buy in" of the deal is critical; everyone,
at all levels of the organization, needs to be on the same page or the deal will
face hurdles out of the starting gate."
-- Keefe, Bruyette & Woods, Inc.:
Marni Pont O'Doherty, May 24, 2001
(Permission for quotes has been obtained)
If you have any questions, require assistance, or need additional copies of
the Proxy Statement or related materials, please call the Shareholder Hotline
at 866-883-0789 or our proxy solicitors:
MacKenzie Partners, Inc.: 800-322-2885
Georgeson Shareholder: 800-223-2064
Copies of the joint proxy statement/prospectus and the SEC filings incorporated
by reference in the joint proxy statement/prospectus are available at the SEC's
Internet site (http://www.sec.gov) and can also be obtained, without charge,
from Wachovia, Investor Relations, 100 North Main Street, Winston-Salem, North
Carolina 27150 (866-883-0789), or First Union, Investor Relations, One First
Union Center, Charlotte, North Carolina 28288-0206 (704-374-6782).
This document may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including statements about the
benefits of the merger between First Union and Wachovia and other statements
that are not historical facts, including statements identified by words such as
"believes", "expects", "anticipates", "estimates", "intends", "plans",
"targets", "projects" and similar expressions.
The following risks and uncertainties, among others, could cause actual results
to differ materially from the anticipated results or other expectations
expressed in the forward-looking statements: (1) the risk that the businesses of
Wachovia and First Union will not be integrated successfully or such integration
may be more difficult, time-consuming or costly than expected; (2) expected
revenue synergies and cost savings from the merger may not be fully realized or
realized within the expected time frame; (3) revenues following the merger may
be lower than expected; (4) deposit attrition, operating costs, customer loss
and business disruption following the merger, including, without limitation,
difficulties in maintaining relationships with employees, may be greater than
expected; (5) the ability to obtain governmental approvals of the merger on the
proposed terms and schedule; (6) the failure of Wachovia's and First Union's
stockholders to approve the merger; (7) competitive pressures may increase and
have an effect on pricing, spending, third-party relationships and revenues; (8)
the strength of the United States economy and the economies in which the
combined company will conduct operations may be different than expected
resulting in, among other things, a deterioration in credit quality or a reduced
demand for credit, including the resultant effect on the combined company's loan
portfolio and allowance for loan losses; (9) changes in the U.S. and foreign
legal and regulatory framework; and (10) adverse conditions in the capital
markets (including changes in interest rate conditions) and the impact of such
conditions on the combined company's capital markets and asset management
activities. Additional factors that could cause Wachovia's and First Union's
results to differ materially from those described in the forward-looking
statements can be found in Wachovia's and First Union's reports filed with the
SEC.
Additional Information
The proposed transaction will be submitted to First Union's and Wachovia's
stockholders for their consideration, and, on June 27, 2001, First Union filed
an amended registration statement on Form S-4 with the SEC containing a
preliminary joint proxy statement/prospectus of First Union and Wachovia and
other relevant documents concerning the proposed transaction. Stockholders are
urged to read the definitive joint proxy statement/prospectus when it becomes
available and any other relevant documents filed with the SEC, as well as any
amendments or supplements to those documents, because they will
contain important information. You will be able to obtain a free copy of the
registration statement and the joint proxy statement/prospectus, as well as
other filings containing information about First Union and Wachovia, at the
SEC's Internet site (http://www.sec.gov). Copies of the joint proxy
statement/prospectus and the SEC filings that will be incorporated by reference
in the joint proxy statement/prospectus can also be obtained, without charge, by
directing a request to First Union, Investor Relations, One First Union Center,
Charlotte, North Carolina 28288-0206 (704-374-6782), or to Wachovia, Investor
Relations, 100 North Main Street, Winston-Salem, North Carolina 27150
(888-492-6397).
First Union and Wachovia, and their respective directors and executive officers,
and others may be deemed to be participants in the solicitation of proxies from
the stockholders of First Union and Wachovia in connection with the merger.
Information about the directors and executive officers of First Union and their
ownership of First Union common stock is set forth in First Union's proxy
statement on Schedule 14A, as filed with the SEC on March 13, 2001. Information
about the directors and executive officers of Wachovia and their ownership of
Wachovia common stock is set forth in Wachovia's proxy statement on Schedule
14A, as filed with the SEC on March 19, 2001. Additional information regarding
the interests of participants may be obtained by reading the registration
statement and the definitive joint proxy statement/prospectus regarding the
proposed transaction when it becomes available.
This letter may contain forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995, including, without limitation,
(i) statements about the benefits of the merger between First Union Corporation
and Wachovia Corporation, including future financial and operating results, cost
savings, enhanced revenues, and accretion to reported earnings that may be
realized from the merger; (ii) statements with respect to First Union's and
Wachovia's plans, objectives, expectations and intentions and other statements
that are not historical facts; and (iii) other statements identified by words
such as "believes", "expects", "anticipates", "estimates", "intends", "plans",
"targets", "projects" and similar expressions. These statements are based upon
the current beliefs and expectations of First Union's and Wachovia's management
and are subject to significant risks and uncertainties. Actual results may
differ from those set forth in the forward-looking statements.
The following factors, among others, could cause actual results to differ
materially from the anticipated results or other expectations expressed in the
forward-looking statements: (1) the risk that the businesses of First Union and
Wachovia will not be integrated successfully or such integration may be more
difficult, time-consuming or costly than expected; (2) expected revenue
synergies and cost savings from the merger may not be fully realized or realized
within the expected time frame; (3) revenues following the merger may be lower
than expected; (4) deposit attrition, operating costs, customer loss and
business disruption following the merger, including, without limitation,
difficulties in maintaining relationships with employees, may be greater than
expected; (5) the ability to obtain governmental approvals of the merger on the
proposed terms and schedule; (6) the failure of First Union's and Wachovia's
stockholders to approve the merger; (7) competitive pressures among depository
and other financial institutions may increase significantly and have an effect
on pricing, spending, third-party relationships and revenues; (8) the strength
of the United States economy in general and the strength of the local economies
in which the combined company will conduct operations may be different than
expected resulting in, among other things, a deterioration in credit quality or
a reduced demand for credit, including the resultant effect on the combined
company's loan portfolio and allowance for loan losses; (9) changes in the U.S.
and foreign legal and regulatory framework; and (10) adverse conditions in the
stock market, the public debt market and other capital markets (including
changes in interest rate conditions) and the impact of such conditions on the
combined company's capital markets and asset management activities. Additional
factors that could cause First Union's and Wachovia's results to differ
materially from those described in the forward-looking statements can be found
in First Union's and Wachovia's reports (such as Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K) filed with the
Securities and Exchange Commission and available at the SEC's Internet site
(http://www.sec.gov). All subsequent written and oral forward-looking statements
concerning the proposed transaction or other matters attributable to First Union
or Wachovia or any person acting on their behalf are expressly qualified in
their entirety by the cautionary statements above. First Union and Wachovia do
not undertake any obligation to update any forward-looking statement to reflect
circumstances or events that occur after the date the forward-looking statements
are made.
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