State Denies Huntington S&L; Takeover : Bid by Real Estate Developer Was Third Attempt in Past 2 Years
For the third time in two years, ailing Huntington Savings and Loan has been left standing at the altar, this time because the state denied the takeover petition filed by the association’s latest suitor.
Anthony Regan, a Malibu real estate developer, was notified Thursday by the state Savings and Loan Department that he did not have adequate financial resources to operate the two-branch S&L; that has sustained losses totaling $450,000 in its last two fiscal years. Regan could not be reached for comment.
The denial of Regan’s takeover application leaves Huntington once again without the rescuer it has sought for the past two years.
However, Huntington S&L; Chairman Robert Terry said late Thursday that Regan’s application might be resubmitted because of some recent changes in his financial condition. Edward Carpenter, the consultant who prepared Regan’s takeover application for the state regulators, confirmed the possibility and said that Regan would meet with Huntington officials next week to determine the next move.
Terry said that Huntington, which has been hurt by losses from poor loans and unauthorized investments by a former officer, strongly needs a partner to infuse new money and management expertise.
Expressed Optimism
Last month, Terry expressed optimism that the Regan proposal would become final. Calling the third takeover proposal in two years “the charm,” Terry said it represented the first time that the association had gotten as far as a signed tentative agreement.
In the now-defunct deal, Regan proposed purchasing all of the association’s stock with a combination of cash and real estate, including a large parcel of undeveloped land straddling the border of Orange and Riverside counties. At the time the proposed deal was announced last month, Terry said that Regan would have up to one year to complete payment for the stock.
Negotiating deals with potential buyers is nothing new to Huntington.
In October, 1983, Mascot Industries Ltd., an Australian conglomerate, offered to buy the association for $6.29 million. When that deal collapsed, the association signed a preliminary agreement to be acquired by Anaheim-based Continental Pacific Enterprises Inc. for at least $6.7 million in cash. However, the deal was canceled in mid-1984.
Huntington opened its doors in July, 1981, with $2 million in capital and $1.1 million in deposits and grew rapidly. By June, 1984, it had assets of $125 million. However, unauthorized investments by a former controller were discovered that same month, erasing earlier gains. The association lists its assets at $90 million and claims a net worth of $1.5 million, a full 50% below the $3 million needed to maintain a net worth equal to 3% of assets, as required by federal S&L; regulators.
The association operates branches in Huntington Beach and Fountain Valley.
