The largest shareholder of Sterling Bancshares Inc. is preparing for a proxy contest to overhaul the Houston company's board.
TAC Capital LLC, which owns 10% of the $5 billion-asset Sterling, announced in a letter to shareholders Thursday that it "has become very frustrated with the continued poor performance of our investment" and plans to nominate five directors to Sterling's 14-member board during the 2011 annual meeting.
"We have lost confidence that Sterling's current board of directors and executive team will be able to unilaterally effect a turnaround of this fine banking franchise and deliver the value that Sterling shareholders deserve," TAC Capital said in the letter.
Its nominees include TAC Capital's president and chief executive, Donald A. Adam.
Sterling had a profit of $4.5 million in the third quarter, compared with a loss of $24.7 million a year earlier.