You can't keep a good man down - or one who faces paying $30 million in capital-gains taxes when his stock in Michigan National Corp. is purchased by National Australia Bank Ltd.

A little more than a week ago at a special meeting in Manhattan, the shareholders of Michigan National overwhelmingly approved a $1.56 billion merger bid from National Australia.

At the same time, an amendment to change the deal from a cash transaction to a stock swap was defeated; 86% of the votes were against it.

But that hasn't stopped Michigan National's former chairman, Standford Stoddard, the author of the amendment, who says he is the bank's largest individual shareholder. (Analysts put his holdings, counting trusts and stock in the hands of other members of his family, at about one million shares).

He continued to hector Michigan National's management to change the terms of the deal so that his windfall wouldn't take such a sizable immediate hit.

"I made an impassioned plea at the shareholder's meeting to permit the issuance of Australia National shares instead of cash," he said in an interview. Without this, "shareholders are subject to Michigan income tax and capital-gains tax of 28%. You lose a third of your value when you cash in."

Mr. Stoddard also said that the special shareholders meeting was held outside Michigan to insure that shareholders wouldn't attend.

"Never before has a board in American banking history held an annual meeting where none of the shareholders could get there." he said. "They have a huge Taj Mahal building in Farmington Hills, Mich., with a gymnasium that can hold 500 people, and they hold the meeting in New York. They didn't want shareholders there."

But Michigan National chairman Robert Mylod said this wasn't true. "The major amount of our stockholders are now in the New York area, so we wanted to give them a chance to attend if they wanted to do so," he said in a phone interview.

Besides, Mr. Mylod continued, "the transaction that we got is a terrific transaction for everybody involved, including Mr. Stoddard." Ten years ago, Michigan National stock was trading at $17 a share, he said. Given the National Australia offer of $110 a share, stockholders earned more than 25% annually on a compound basis over the period.

But the bottom line is that National Australia would never go for a stock deal. The $93 billion-asset bank has so much excess cash from its "overwhelming" market share Down Under that one of the main reasons for doing the deal was to "leverage that capital," according to Andy Senchak of Keefe, Bruyette and Woods Inc.

A stock deal would have also meant dilution for National Australia shareholders, Mr. Senchak said. Trading National Australia shares for Michigan National stock would have increased the Australian banks capitalization by $1.56 billion, lowering earnings per share for the old stock, he said.

None of these arguments seemed to satisfy Mr. Stoddard. But as one analyst put it, "It's hard to feel sorry for a guy who is about to make $70 million."

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