The Los Angeles City Council has registered its opposition to H.F. Ahmanson & Co.'s proposed acquisition of Great Western Financial Corp., citing the "expected loss of over 3,000 jobs" if the merger goes through.
The 15-member council sent a resolution last week to the Office of Thrift Supervision opposing Ahmanson's hostile offer. The comment period on Ahmanson's merger application ends today. Once it deems the application complete, the OTS has up to 60 days to rule on it.
The council also called on the Los Angeles Department of Pensions to reject the bid. The city's pension funds held 15,800 shares of Great Western stock as of Dec. 31, according to CDA/Investnet.
In addition, City Councilman Hal Bernson, whose district includes Chatsworth, where Great Western is based, requested that the OTS hold a public hearing on the proposed merger.
"Job losses and reduced services resulting from the Ahmanson proposal could have devastating consequences for local neighborhoods and families," Mr. Bernson wrote.
The closing of Great Western's headquarters would lead to the loss of 3,000 jobs, he wrote, in addition to any job losses from the expected closing of 180 retail branches in southern California. Washington Mutual, which has a friendly agreement to merge with Great Western, has said it would close the headquarters as well as 200 retail branches and loan offices in the state.
"What was so startling to us was the implication that if Wamu were to merge, the headquarters would remain intact with all 3,000 people, but if we buy them it wouldn't," said Mary Trigg, an Ahmanson spokeswoman.
Ms. Trigg also said that Ahmanson was never informed that the council would be addressing the issue last week and thus never had a chance to present its case.
Spokesmen from Great Western and Washington Mutual said they were pleased with the Council's actions.
