500 or bust?
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So much for the naysayers implying that WFC wouldn’t spinoff PCG/AGE
DOW JONES NEWSWIRES Swiss banking company UBS AG (UBS) has held preliminary talks with WachoviaSecurities about a joint venture of the pair's North American wealth-management
units, The New York Post reported in its Tuesday editions. The deal would
combine UBS' wealth-management group, which has more than 8,000 retail brokers
in the U.S., with Wachovia Securities' 16,000 financial advisers. Wachovia was
acquired late last year by Wells Fargo & Co. (WFC). A UBS spokeswoman declined
to comment. A Wells Fargo spokeswoman directed calls to a Wachovia Securities
spokeswoman, who declined to comment.
The wells CFO - Howard Atkins - made a presentation to the annual CITI Financial Services conference.
https://www.wellsfargo.com/invest_relations/presents It: 1) Describes in detail the state of the bank (pretty darn good on the wells side) 2) Discusses Wachovia seperately (becuase results aren't good) 3) Makes no mention of WS - specifically leaving them out of the forward looking strategy of the company. Ouch. Time to fax AUM and T12 to UBS and MS. Today!FT article says that UBS is not currently in talks but doesn’t deny they had been in talks. Selling it or giving control to someone else (like SB to MS) does not make sense, according to unnamed sources at UBS with knowledge of the talks.
I tried to put up the link, but could not.
WOW…i know this rumor has been out there, but I just did not see it happening. I can not wait until tonight to see the AGE guys going crazy over this news. it does help explain the retention delay (even if there is not one). Wonder what this will mean for ISG guys, and I know they have already been folded into Wealth, but does the odds of retention go up or down if there is a “tie-up” with UBS
Reg Rep wrote: So much for the naysayers implying that WFC wouldn't spinoff PCG/AGE
But does bew this imply that Wells is dumping WS or that WS is picking up UBS securities operation? I'd suggest it is WS picking up UBS' securities operation. And if there is an announcement Wednesday or Thursday -- what a coincidence -- just after the potential meger news comes out they finally announce some official final decision on name and retention. This was obviously the reason for all the radio silence - probably had an announcement set for December - then the UBS deal appears as an opportunity - Wells needs a month and a half to evaluate that issue and no one can say anything in the meantime. And the fact that the joint venture is likey the reason for the delay may indicate retention is not as lousy as some may have started to assume due to all the delays. It wasn't DL's retention plan getting denied over and over, it was the potential UBS deal needing to be evaluated. That's at least a bit of relief however; now we need the announcement - good or bad - of what the retention actually is. Finally, the question is why is UBS paying up for so many brokers for the securities firm if they are so ready to blow the whole division out?The reason is because they are not going to blow the whole thing out, as you say. cf. the FT article. They recognize selling wasn’t an option and that was much batted about mid 2008, which in dog years was 10 years ago.
PS: UBS folding under WS or WFC also takes the spin out of the IRS issues that have been in the news lately in regard to UBS securities. If it
FT story is a pre NY Post story. Which one is mor accurate?FT article says that UBS is not currently in talks but doesn’t deny they had been in talks. Selling it or giving control to someone else (like SB to MS) does not make sense, according to unnamed sources at UBS with knowledge of the talks.
I tried to put up the link, but could not.
No I told you first
My theory is that WFC thinks because they bought WS/AGE with no retention they can venture out and buy UBS with no retention. This is a stall tactic. It will be 6 months before they admit there is not going to be a retention. WFC will be left with 10,000 brokers that do 200k or less. They have treated us like cr_p!
The name will be WELLS FARGO ADVISORS.
To be announced after Wachovia overtime issues are resolved. Source said exactly what is being implied above that UBS would be wrapped under WS if it were to happen. Source seemed a little wishy washy when asked about retention. But did mention that WFC is aware that most guys doing 400m and up T12 can get paid to go somewhere else. Also acknowledged that the average AGE guy is different from MER, MS, etc... because of smaller town exposure. Small town clients need love too.It will look very similar to the WS/Pru merger. They put the brokerage in an LLC where they run their own PL. After tax profits are distrubited along the lines of ownership of the LLC. In the case of WS/PRU Pru got 33.3% and WS the remainder. WS had access to WB for its banking capabilities. The same will be true of Wells Fargo. As I recall, someone told me that UBS used Wells for its Mortgage business. Pru put up 2/3rds of the merger costs. At first blush, most people thought Art Ryan had made a terrible deal. In the end, he made a monster deal. Over the 5 years PRU had the minority interest in the LLC they recieved close to 2 Billion in after tax profits and then put their interest to Wells for 5 billion. All total, Pru recieved close to 7 biillon for PRU securities. That is compared to an offer of 2.5 by Lehman a year before the WS/PRU meger. What looked like a dumb deal at first turned out to be the best move they could have made. In the long run this deal makes tremendous sense for both parties. It allows Wells to have all of the benefits financially of the brokerage without any of the liabilities (once merger costs are paid) It allows UBS to recieve substaincially more for UBS brokerage then they could get in todays market environment.ubs and ws with no bank?
Big question for this forum is how does this affect retention if it happens. Does wells still pay us? Or does retention come out of the the new UBS Wachovia securities and where do they get the money?
This all has turned into a collassal mess.It will look very similar to the WS/Pru merger. They put the brokerage in an LLC where they run their own PL. After tax profits are distrubited along the lines of ownership of the LLC. In the case of WS/PRU Pru got 33.3% and WS the remainder. WS had access to WB for its banking capabilities. The same will be true of Wells Fargo. As I recall, someone told me that UBS used Wells for its Mortgage business. Pru put up 2/3rds of the merger costs. At first blush, most people thought Art Ryan had made a terrible deal. In the end, he made a monster deal. Over the 5 years PRU had the minority interest in the LLC they recieved close to 2 Billion in after tax profits and then put their interest to Wells for 5 billion. All total, Pru recieved close to 7 biillon for PRU securities. That is compared to an offer of 2.5 by Lehman a year before the WS/PRU meger. What looked like a dumb deal at first turned out to be the best move they could have made. In the long run this deal makes tremendous sense for both parties. It allows Wells to have all of the benefits financially of the brokerage without any of the liabilities (once merger costs are paid) It allows UBS to recieve substaincially more for UBS brokerage then they could get in todays market environment.[/quote] Finally someone admits WS can do something right!![quote=CDO Squared]ubs and ws with no bank?