A well-known thrift investor group is attempting to throw a monkey wrench into a planned merger between two South Carolina savings and loans.

Columbia, S.C.-based Mid-Atlantic Investors filed with the Securities and Exchange Commission earlier this month to register its purchase of 285,000 shares, or 9.9%, of United Financial Corp. of South Carolina for $6 million.

United Financial, a thrift holding company based in Greenwood, reported on April 11 that it had plans to merge with American Federal Bank of Greenville.

The union of American Federal and United Financial would create the largest independently owned financial institution in South Carolina, with combined assets of $1.8 billion.

But the stock of United Financial, the smaller of the two thrifts, with $671 million in assets, has suffered since the announcement because the deal is structured as a "merger of equals," with no premium paid to either side.

Mid-Atlantic managing partner H. Jerry Shearer made it clear he does not support the merger of United Financial and American Federal. "We just have a fundamental belief that so-called 'mergers of equals' don't work out and we feel at some point there will be a recognition of that," he said. "We want to be present when that takes place."

Full Speed Ahead

Executives for both United Financial and American Federal said they did not expect Mid-Atlantic's move to derail their planned merger. "We're moving full speed ahead," said American Federal Chairman W.L. "Roy" Abercrombie Jr.

In the last three years, Mid-Atlantic has taken 10% stakes in two South Carolina thrifts and then successfully pressured their boards to sell out for a premium to commercial banks.

In March, Mr. Shearer and his partner Jerry Zucker made a similar investment in Bankers First Corp., an S&L based in Augusta, Ga.

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