Wells Fargo Closes Deal for Strong
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Banking giant Wells Fargo & Co. on Monday completed its acquisition of beleaguered mutual fund provider Strong Financial Corp., saying it expected to blend Strong’s business into its existing lineup of mutual funds during the second quarter.
The bank hasn’t decided whether it will rename Strong Financial’s mutual funds, Wells spokesman Won Ha said.
Strong Financial’s sales price hasn’t been disclosed. Industry analysts believe Wells paid $400 million to $700 million, a sharp discount from Strong Financial’s estimated value before the Menomonee Falls, Wis.-based company faced allegations of misconduct.
Wells’ shares declined 24 cents to $61.91 on Monday on the New York Stock Exchange.
Industry regulators accused Strong Financial’s founder and former chief executive, Richard Strong, of conducting improper trading practices at other shareholders’ expense, turning the firm into a symbol of the mutual fund abuses that rocked the industry last year. Richard Strong and the company paid more than $175 million in penalties.
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