into a Wall Street bonanza. Between Wells Fargo & Co.'s unsolicited bid and First Bank System's white-knight agreement to acquire the Los Angeles-based bank, there are at least five investment banks, five law firms, and two proxy solicitation companies at work. "For Wells Fargo and First Interstate this is armed combat, trench warfare," said Gary Shedlin, an investment banker with Lazard Freres & Co. "You need to have really deep benches and the best advice you can get." Like other investment bankers, Mr. Shedlin said the number of players was unsurprising, given the deal's complexity. Now that First Bank System has emerged as a white-knight suitor for Interstate, the game may be closed to investment bankers who had been advising other banks on potential bids for the Los Angeles bank. Still, some say the deal has attracted more bankers, lawyers, and consultants than any other bank transaction to date. NationsBank Corp.'s purchase of C&S/Sovran Corp. in 1991, when the bank employed five investment banks, is seen as the runner-up to the new deal in terms of advisery firepower. NationsBank had launched a hostile bid for Citizens & Southern, only to be thwarted by a white-knight bid by Sovran Corp. It hired the investment banks to prevent them from helping C&S/Sovran fight the acquisition, said Robert Baer, director of financial institutions mergers and acquisitions at Bear Stearns & Co. In the battle for First Interstate,
the target bank is using Morgan Stanley & Co. and Goldman Sachs & Co., both of which teamed up to advise Chase Manhattan Corp. in its announced sale to Chemical Banking Corp. last August. First Interstate also has the legal team of Skadden Arps Meagher & Flom on board, as well as the proxy solicitation firm of Georgeson & Co. Wells Fargo has hired San Francisco's Montgomery Securities and CS First Boston Corp. The bank has retained Sullivan & Cromwell for legal advice and the proxy solicitation firm D.F. King & Co. First Bank System is using the investment banking services of J.P. Morgan & Co. Its legal advisers are Cleary Gotlieb Steen & Hamilton and Dorsey & Whitney. Prior to First Bank's agreement with First Interstate, Merrill Lynch & Co. is said to have helped Norwest Corp. explore a possible bid. And Lazard Freres is said to be working with Banc One Corp. exploring a similar bid. This leaves UBS Securities, Salomon Brothers, Keefe Bruyette & Woods Inc., Smith Barney Inc., and Lehman Brothers as the only remaining firms with sizable financial institutions groups that haven't found a role in the battle. In trading Thursday, shares of Wells Fargo and First Interstate rose on renewed speculation Wells was set to raise its bid. Wells shares rose $4 to $215.375, and Interstate rose $2.875 to $132.75. First Bank System rose $1.125 to $52.375.