Takeover Bid Rejected by Kaiser Shareholders

Kaiser Aluminum & Chemical Corp. said Sunday that shareholders have “overwhelmingly rejected” a takeover attempt by a group led by a reclusive British investor, an Oklahoma real estate magnate and a corporate takeover specialist.

British investor Alan E. Clore, takeover specialist Charles Holmes and Joseph A. Frates of Tulsa, Okla., had solicited shareholder consents in an attempt to throw out the current board of directors and assume control of the nation’s third-largest integrated aluminum producer.

However, the three men, who collectively hold 21.6% of Kaiser’s outstanding stock, could not obtain consents representing a majority of common shares outstanding as required by the March 22 deadline. Consents are like proxies but without the annual meeting.

‘Beat Them Big’

“We are obviously heartened by the results,” said Steve Hutchcraft, president of Oakland-based Kaiser in a telephone interview Sunday. “We beat them and we beat them big.”

Leonard T. Conway, a spokesman and member of the Frates investor group, was away from his New York home Sunday and could not be reached for comment.

However, Cornell C. Maier, chairman of Kaiser, said the board of the troubled aluminum company may face a second challenge from the investor group at Kaiser’s April 29 annual meeting.

Such a vote would differ marketly from the soliciting of consents. Only the sentiments of those present at the annual meeting would be counted, not all of the outstanding shares, Kaiser officials said.

“If that is the course they decide to follow,” said Maier, “we intend to fight just as hard to protect our shareholders’ interests as we did during the consent solicitation.”

The defeat of the Frates investor group came about six months after Frates and several of his colleagues met with Kaiser Aluminum officials and disclosed plans to take over the aluminum concern.

$471 Million in Losses

The Frates group has offered to exchange a package of about $8 in cash and $13.50 in securities for each share of Kaiser Aluminum common stock.

But Kaiser Aluminum, which has rolled up $471.3 million in losses during the last four years due to the depressed aluminum industry, defended itself vigorously against the Frates group.

The aluminum concern not only sought the support of its largest institutional investors, such as United Banks of Colorado, but it spent days calling small shareholders urging them to retain the current board.

“Kaiser’s shareholders obviously shared our serious concerns over the conditionality and speculativeness of the Frates-Clore-Holmes proposal as well as the business histories of certain members of the group,” Maier said.