Ahmanson Says GW Investors Back Proposal
In an apparent boost to its hostile takeover bid for Great Western Financial, H.F. Ahmanson & Co. said Friday that it won investor backing for a proposal urging Great Western to share information and negotiate with Ahmanson.
Until now, Ahmanson, the parent of Home Savings of America, has not even been able to meet with Great Western, which has signed a friendly merger deal with Washington Mutual of Seattle. But the Ahmanson-proposed resolution, which was put to a vote before Great Western stockholders, increases pressure on the board of the Chatsworth-based thrift to open its books to Ahmanson and reconsider its offer.
A Great Western spokesman Friday downplayed the importance of the nonbinding resolution and questioned whether Ahmanson had received enough shareholder votes, known as “consents,” in the first place.
But Ahmanson said it delivered consents representing a majority of Great Western’s outstanding shares to an independent examiner. If the consent forms are verified, a procedure that should be completed in a few days, analysts say it would be significant to Irwindale-based Ahmanson.
“Certainly, if a majority of the shareholders are saying this to the board, they have to take it very seriously,” said Charlotte Chamberlain, a securities analyst at Jefferies & Co. in Los Angeles. “To uphold their fiduciary responsibility, this is something they can’t brush off.”
Ahmanson, the nation’s largest thrift, already has been rejected twice by Great Western, the second time after Ahmanson sweetened its offer following the emergence of Washington Mutual as a “white knight” bidder for Great Western.
Based on Friday’s stock prices, Ahmanson’s offer was worth $6.02 billion, or $42.30 a share, to Great Western shareholders, slightly more than the value of Washington Mutual’s offer of $5.83 billion, or $40.95 a share.
Shares in Ahmanson, Great Western and Washington Mutual all fell sharply Friday in tandem with the broader stock market. Washington Mutual’s stock fell $2.25 to close at $45.50 on Nasdaq. Ahmanson shares fell $2 to close at $35.25; Great Western stock dropped $2 to close at $39.75. Both trade on the New York Stock Exchange.
One large institutional shareholder of all three thrifts said he supported Ahmanson’s resolution because he saw no risk in it.
“It was a no-lose situation. Why not?” he said. “I want Great Western to take the highest bid possible.”
Most of Great Western’s shares are held by large institutional investors, such as mutual fund companies.
Madeleine Kleiner, Ahmanson’s general counsel, said that with additional financial information from Great Western, Ahmanson could identify greater merger-related cost savings and revenue potentials than previously projected.
Great Western representatives reiterated Friday that they have carefully considered Ahmanson’s merger offer, and observers say they expect Great Western to continue to put up fierce resistance to a meeting with Ahmanson.
The two thrifts also continued to battle over the annual meeting date for Great Western. Ahmanson, which said it has bought 3.1 million shares (or 2.2%) of Great Western stock since it launched its takeover bid in mid-February, wants a meeting as soon as possible. It will try to get three of its nominees elected to Great Western’s 11-member board to press Ahmanson’s case. Earlier this week, Ahmanson said it won investor support that would require Great Western’s board to hold its annual meeting by May 6. But on Friday, Great Western set June 13 as the meeting date, prompting Ahmanson to take further legal steps, which Great Western said were not immediately successful.
Great Western’s annual meeting was originally scheduled for April 22, but the company postponed the meeting in an effort to slow down Ahmanson’s effort while it could weigh rival bids.
