Leucadia Seeks to Hike Intergroup Stake
Leucadia National Corp., rebuffed in two recent bids to influence National Intergroup Inc., asked government regulators for authority to more than double its 9% stake in the company, a Leucadia official said Tuesday.
Leucadia informed the Securities and Exchange Commission that it would ask the Federal Home Loan Bank Board for permission to raise its holding to more than 10% of NII’s approximately 20 million common shares outstanding, said Steven E. Jacob, an attorney representing the New York financial-services company.
Leucadia, which has said it wants to sell NII’s assets and distribute the proceeds to shareholders, is currently prevented from acquiring 10% or more of NII under laws regulating ownership of savings and loan associations.
NII of Pittsburgh is a diversified manufacturer that controls more than 81% of First Nationwide Financial, the eighth-largest U.S. savings and loan association with assets of about $9.4 billion as of the end of 1984.
“If we get permission . . . then we intend to acquire more shares, not to exceed 24.9% of National Intergroup,” Jacob said. “Of course, we always reserve our right to change our minds.”
A stake of 25% or more would subject Leucadia to restrictions under the Savings and Loan Holding Company Act, he said.
NII spokesman Edward J. Klein said company officials had no comment on the announcement by Leucadia, now NII’s largest single investor with about 1.8 million shares.
Leucadia President Joseph S. Steinberg has said that NII’s stock, currently trading at about $24 per share, is undervalued because the company’s manufacturing, distribution and financial-services businesses are too diverse for investors to easily assess.
Leucadia acquired a 7.2% stake in NII after the October announcement that NII planned to merge with Bergen Brunswig of Los Angeles, a prescription drug distributor.
In March, Leucadia lost a proxy contest in which it tried to block shareholder approval of the deal.
The challenger said Bergen’s $580-million offer was inadequate.
After boosting its stake to 9%, Leucadia failed last week to gain any of the four seats that were open for election on NII’s board of directors.
Leucadia said it would have used the board positions to advocate asset sales.