Pressure is mounting on Hamilton Financial Services Corp., San Francisco, to put itself up for sale.
Investors who hold substantial stakes in Hamilton have reportedly followed the lead of Kramer Spellman, an investment partnership in Fort Lee, N.J., and written to the mortgage company's board to push for a sale.
Orin Kramer, a general partner of Kramer Spellman, started the ball rolling when he wrote to the Hamilton board in a letter dated Aug. 21.
"I believe that outside parties would have an interest in acquiring Hamilton at a premium to the current stock price," he said. "I believe the opportunities for outright sale offer far greater shareholder value than would any course of action which does not involve the outright sale of the company."
Mr. Kramer also said he opposed any course that would keep the current management team in place at Hamilton.
One source familiar with Hamilton said it might already be discussing a sale of the company with a potential buyer. Hamilton's board met on Wednesday, after Mr. Kramer's letter had gone out, but there was no word about what was on the agenda.
Copies of the letter were sent to money managers and investors who hold big positions in Hamilton shares, including Nicholas Adams of Wellington Management and Raymond Garea of Mutual Shares.
Kramer Spellman and the investors who got copies of the letter to the Hamilton board hold almost 50% of the mortgage company's shares, according to Mr. Kramer's letter.
The list includes Henry Salzhauer of New York, who personally owns 140,000 shares. His son, Michael Salzhauer, is a Hamilton director.
He says he and his son have a pact never to discuss the company. He has written the board supporting Mr. Kramer's position that the company should be sold.
"The company has a lot of potential but it's probably better owned by a bigger kind of organization," he said. "In the change of market culture in that industry, the size is against it. They process loans well, have an inexpensive servicing platform and a lot of very good people.
"But they need to get more loans into that servicing platform. I think they can service close to $10 billion. I don't think they can overcome the problems by themselves."
There was little action in Hamilton shares last week, with the bid price holding steady at $2.125.
