Calif. Thrifts Wondering If They're The Next Target on Ahmanson's List

As H.F. Ahmanson & Co.'s chances of winning Great Western Financial appear to fade, some California thrift executives are wondering if they might become Ahmanson's next target.

Carl Webb, the president of California Federal Bank, raised the possibility in a recent interview that Ahmanson would try to sign a friendly deal with a big local rival.

"Our phone is not ringing," Mr. Webb quickly noted. But he said it was "quite possible" that Ahmanson would put CalFed on a short list of potential partners. Also being mentioned as targets are Glendale Federal Bank and Coast Savings Financial.

Such a deal would provide Ahmanson with protection from a takeover that some expect Washington Mutual Inc. to pursue once it absorbs Great Western.

A CalFed-Ahmanson combination would create an $81 billion-asset institution-just $7 billion smaller than the thrift resulting from the proposed merger of Chatsworth, Calif.-based Great Western and Washington Mutual, Seattle.

It would have more branches than Wamu-Great Western (635 to 604), and almost as much in deposits ($51.7 billion versus $52.6 billion.)

Though CalFed is generally classified as an acquirer, not a target, analysts say the thrift, which is owned by MacAndrews & Forbes Holdings, would have a hard time turning down a buyout offer, if offered a premium as rich as the three-times book offered to Great Western.

Another area thrift executive, speaking on condition of anonymity, said the purchase of CalFed's California thrift by Ahmanson would make sense: it would help keep interest in Ahmanson's stock up, once the excitement of the Great Western battle starts to dissipate.

But he noted that Ahmanson, which is trying to exit the mortgage business, would probably not be interested in CalFed's big mortgage operation in Maryland.

The thrift executives aren't the only ones who see Ahmanson staying on the acquisition path if it loses Great Western.

"My impression of (Ahmanson chairman) Charlie (Rinehart) and the team he's built is that they're not going to sit back and wait to be acquired," said Randy Hill, a partner at the Los Angeles office of the executive search firm Heidrick & Struggles.

But skeptics argue that a merger with CalFed might be a step backward, because CalFed is not as far along in becoming a consumer bank as Ahmanson.

The logic of a combination between Washington Mutual and Ahmanson, possibly a year after Wamu buys Great Western, still sways many.

Washington Mutual chairman Kerry Killinger sees his Seattle-based thrift evolving into a West Coast powerhouse, competing closely with BankAmerica Corp. and Wells Fargo & Co., says analyst Thomas O'Donnell of Smith Barney.

If he nabs Ahmanson, he'll have a total of 16% of California's deposits, comparable to Wells' 15% share, and Bank of America's 22%.

Moreover, Mr. Killinger could take advantage of the tremendous cost- savings from consolidating overlapping Great Western and Ahmanson branches- the same savings that drove Ahmanson to bid on Great Western.

But given the hostility that may linger between the two companies, the prospect of integrating Ahmanson's management into Wamu might discourage a deal.

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