The battle for control of Great Western Financial Corp. focused on legal technicalities Wednesday as investors awaited more hard data on the two bids for the big thrift.
Analysts said it may be difficult for H.F. Ahmanson & Co. to match Washington Mutual Inc.'s agreement to buy Chatsworth, Calif.-based Great Western, so Ahmanson was doing its utmost to put its white-knight rival on the defensive.
The Ahmanson camp seized on Washington Mutual's failure to file with the Securities and Exchange Commission a much-anticipated document, called an S-4, that would spell out the terms of its proposed merger.
Washington Mutual was expected to file the document Tuesday, one day after Ahmanson filed its own S-4 and told investors the Seattle-based thrift's bid is "absurd" .
The timing of Ahmanson's filing speaks to the experience of its legal adviser, H. Rodgin Cohen of Sullivan & Cromwell, said Ronald H. Janis, a lawyer who has advised on numerous bank mergers.
"I was amazed to see Ahmanson filed the same day it spoke with investors," said Mr. Janis, who is with Pitney Hardin Kipp & Szuch. "It contained everything they said about cost savings in the conference call to investors. That's unusual."
Such concise detail in the Irwindale, Calif.-based thrift's filing, he said, may be designed to put Washington Mutual under pressure to come up with similar support for its cost-savings numbers.
If it fails to do so, it could leave Ahmanson an opening to attack the white-knight bid as unrealistic.
The S-4 would make public the terms of Washington Mutual's merger with Great Western. Although much of the information has already been disseminated, the S-4 is the official game plan for the merger, and can be challenged in court, attorneys said.
Washington Mutual officials declined to address questions about the timing of the filing, saying they were prohibited from talking in advance of the filing. A spokeman said the document might be filed today.
Analysts were mystified by Washington Mutual's delay, and suggested that the the thrift might be reexamining its offer after Ahmanson chief executive Charles Rinehart dismissed its estimaates
A person familiar with the situation said Washington Mutual did not have an S-4 on file when it announced its definitive agreement with Great Western, something the SEC apparently expects.
In the short term, Washington Mutual's delay in filing adds fuel to concerns that the white-knight bid may not be as solid as it says.
"My presumption is they're trying to address the issues Ahmanson raised on Monday, specifically the cost savings," said Scott McAdams, analyst with Ragen MacKenzie Inc. in Seattle.
"Right now, Wall Street is split fifty-fifty" on whether Washington Mutual can acheive its claimed cost savings in a Great Western merger, said UBS Securities analyst Gareth Plank, who supports the Seattle thrift's bid.
He said that to top Washington Mutual's offer at current share prices, Ahmanson would have to hike its current bid of 1.05 shares for every Great Western share to 1.2 shares, thus diluting its stock.
A sharp rise in Ahmanson's stock price would be the only other way to bridge the gap between its offer and Washington Mutual's.
In trading Wednesday, Ahmanson shares were off 50 cents, to $41.25. Washington Mutual shares fell $1.25, to $53.25.