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Judge refuses to block deal

Friday, July 20, 2001 | 10:52 a.m.

GREENSBORO, N.C. -- A judge refused to block the merger of Wachovia Corp. and First Union Corp., rejecting in today's ruling a request by rival suitor SunTrust Banks Inc.

"The court is convinced that, after a vigorous proxy fight, the shareholders of Wachovia can make an uncoerced, fully informed decision about whether or not they wish to approve the merger with First Union," North Carolina Business Court Judge Ben Tennille wrote.

But he rejected as "invalid and unenforceable" a nontermination clause that would, for several months, block Wachovia from merging with another bank if the agreement with First Union fell through.

The 64-page ruling could be a major blow to SunTrust in its attempt to buy Wachovia, based in Winston-Salem.

But Barry Koling, a spokesman for Atlanta-based SunTrust, said Tennille's position on the nontermination clause was a positive move.

He said no decision has been made on a possible appeal.

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