Ambanc Holding Co., Amsterdam, N.Y., has agreed with activist shareholder Seymour Holtzman on a means to pave the way for it to close a previously announced merger.
Ambanc, with $520 million of assets, was cleared by the shareholder to complete its $30 million acquisition of Afsala Bancorp, also of Amsterdam.
Mr. Holtzman began a campaign through legal action and by rallying shareholder support to block the merger soon after it was announced in May. Though that motion was dismissed, Ambanc did adjourn the meeting minutes after it began, in part because Mr. Holtzman had held his own informal shareholder meeting an hour earlier.
As part of Tuesday's settlement, the Florida investor-who owns 4.7% of Ambanc's common shares and 8.4% of Afsala's-also agreed to drop all litigation against Ambanc and refrain from new litigation until Jan. 1, 2000.
In return, Ambanc has agreed to retain Sandler O'Neill & Partners, New York, after the merger is completed, to "seek ways to maximize shareholder value, including the possible merger of the combined companies with a third-party acquirer," Mr. Holtzman said in a press release.
If Ambanc does not enter into a merger agreement by April 1, 1999, it will appoint two people selected by Mr. Holtzman to its board of directors.
Ambanc will also reimburse Mr. Holtzman $80,000 for a part of his litigation expenses.
- Louis Whiteman