Big GW Investors Favor Talks, Suitor Says
H.F. Ahmanson & Co. said Monday that most of the biggest investors in Great Western Financial Corp. favor a proposal calling for the Chatsworth-based savings and loan to start talks with bigger rival Ahmanson.
Irwindale-based Ahmanson, the parent of Home Savings of America, said that 19 of Great Western’s 20 biggest investors have voted for or indicated that they would vote yes on a consent proposal to pressure Great Western to start negotiations.
Ahmanson launched a hostile bid in mid-February for Great Western and has been tenaciously fighting to complete the deal despite Great Western’s rejection and its agreement, announced March 6, to a friendly merger with Washington Mutual Inc. of Seattle.
The Ahmanson and Washington Mutual bids would involve stock swaps. Each deal was valued at about $6.1 billion as of Monday. In New York Stock Exchange trading, Ahmanson closed down $1 at $36.375, and Great Western Financial closed down $2.125 at $40.50. Washington Mutual closed off $1.25 at $48.3125 on Nasdaq.
Great Western responded to Ahmanson’s statement Monday by saying Ahmanson’s effort to solicit shareholder consents falls “far short” of representing a majority of the outstanding shares.
Ahmanson said more than 80% of “voted” Great Western shares supported its proposals, but did not say what percentage of votes representing the 139 million outstanding shares was received.
Ahmanson had initially set a March 27 deadline, but it may continue soliciting consents until about May 12.
A few of the major institutional investors confirmed the assertion of a favorable reaction toward the solicitation and the notion of Great Western’s opening up negotiations with Ahmanson.
“The consent was a free vote. Voting against it would be silly. Of course, it would be advantageous to us if they opened up negotiations, but it will come down to which offer is the best at the end of the day,” said a representative of one institutional investor who asked not to be identified.
But analysts noted the outcome of the consent solicitation does not mean the investors favor one bid over another.
