North Fork Bancorp chairman John Adam Kanas, going on the defensive Tuesday, said its outlook for second-quarter and yearend profits was positive despite market rumors to the contrary that have dampened the Melville, N.Y., company's stock in recent weeks.
During a teleconference with reporters and investors of Dime Bancorp shares, Mr. Kanas said he was "suspicious" of the origin of the rumors. North Fork's stock has declined 12% since its level of $17.750 at the beginning of June.
North Fork and Dime have been locked in a contentious battle since this spring, when Mr. Kanas launched an unsolicited $1.9 billion takeover of the New York thrift. The takeover bid succeeded in blocking Dime's plans to merge with Hudson United Bancorp of New Jersey.
"Our balance sheet is rock solid," Mr. Kanas said in an attempt to debunk rumors of credit quality problems. "We continue to feel that the quarters will get better and better."
With that, the feisty Mr. Kanas proceeded to throw his own rumors in Dime's direction in another attempt to sway opinion in favor of his merger proposal.
Mr. Kanas said he had heard rumors this week that MetLife Inc., the huge New York insurer that recently announced plans to introduce banking services to its policyholders, may be preparing a bid for Dime. Should MetLife buy Dime, Mr. Kanas said he could take credit for helping to advance the cause of industry convergence.
"We could be a catalyst," Mr. Kanas said. "It would break the logjam" for the mergers of banks and insurance companies.
A MetLife spokesman said the company does not comment on rumors in the marketplace.
A spokesman for Dime declined to comment on Mr. Kanas' remarks.
Rumors aside, Mr. Kanas threatened to stick with his bid for Dime to the bitter end, and added he had a budget of $10 million to "see this through."
His plan is to convince enough Dime shareholders to vote against - or "withhold authority," in technical parlance - the five director nominees Dime has offered for election at its annual shareholders meeting scheduled for July 14.
Should a majority of Dime shareholders side with Mr. Kanas, he would have the chance to introduce his own slate of candidates at next year's annual meeting.
This would allow him to take over the company.
So far about 18.6 million of Dime shares have been pledged to support North Fork, Mr. Kanas said. That is about 17% of Dime's total shares outstanding, up from the 9% share Mr. Kanas reported last month.
Mr. Kanas has asserted that Dime's management will do everything in its power to prevent a sale of the company to North Fork. In previous statements, Dime has called North Fork's offer inadequate and said it is in the midst of a strategic review of its alternatives. Dime has also said it has entered into preliminary discussions with potential suitors.
To date no other bidders have stepped forward.
During the conference call, Mr. Kanas also appealed to Dime's low-level employees. North Fork's history with mergers shows that the majority of the cost savings have come from slashing the executive ranks, not the rank-and-file, he said.
"There are 300 openings at North Fork we can't fill," Mr. Kanas said. "Lower level employees shouldn't be worried about it."
