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Washington Mutual to Buy Providian in $6.45 Billion Deal





Is WaMu preparing for the inevitable decline of its mortgage business?

From Wall Street Journal:

Under the terms of the agreement, shareholders of Providian will receive the equivalent of 0.45 Washington Mutual share for each Providian share, to be paid 89% in stock and 11% in cash, the company said. Based on the closing price of Washington Mutual's stock on June 3, the implied per-share purchase price is $18.71, it said.

...

The acquisition "enhances Washington Mutual's consumer-banking growth while strengthening our leadership position in the middle-market customer segment," Kerry Killinger, chairman and chief executive of Washington Mutual, said in a statement. "Providian is a highly profitable business with solid credit quality. Its focus on middle market consumers makes Providian a natural fit for our business and a winning combination for both companies' customers," he said.

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