A thrift investor is contesting Norfolk, Va.-based Cenit Bancorp's claim that shareholders rejected his efforts to look for a buyer.
H. Jerry Shearer, managing partner of Mid-Atlantic Investors, a Columbia, S.C., group that has been pushing for Cenit's sale, complained about the disqualification of a block of votes he said supported his position.
"We're not accustomed to receiving the most votes and not winning," said Mr. Shearer, whose group owns a 9.7% stake in Cenit.
The group had asked shareholders to back his slate of three directors as well as consider selling the $707 million-asset company.
Cenit declared victory Tuesday, saying Mid-Atlantic had lost by 7,012 votes-670,777 to 663,765.
The disqualified block in question totaled 19,500 shares. Those shares were listed in the name of the trust company that held them, not their actual owner's, Mr. Shearer said. However, he said, the owner had submitted an affidavit to Cenit that should have made the votes count.
Under those circumstances, Mr. Shearer said, not counting them violated Securities and Exchange Commission rules.
The thrift told him it never got the affidavit, he said.
Michael S. Ives, president and chief executive officer of Cenit, said it would contest a Mid-Atlantic lawsuit on these grounds, were one filed.
Mr. Ives said that the election was conducted fairly by CT Corp., a Wilmington, Del.-based independent inspector of elections, and that there were disqualified votes on both sides.
"I think it's clear that the stockholders supported our board of directors," said Mr. Ives, who has been battling Mr. Shearer's group for months to keep Cenit independent. "We are looking forward to returning to the banking business."
