Magazine article American Banker

Stocks: St. Paul of Chicago Gains as Keefe Pushes for Sale

Magazine article American Banker

Stocks: St. Paul of Chicago Gains as Keefe Pushes for Sale

Article excerpt

St. Paul Bancorp shares climbed nearly 5% in a down market Wednesday after a major stockholder stepped up his campaign to force the Chicago thrift company to sell.

Harry V. Keefe Jr., who owns a million shares of St. Paul, said he had requested a list of shareholders from the company, a preliminary step to a proxy fight, and renewed his criticism of management.

"Having reviewed St. Paul's very disappointing fourth-quarter results, I now believe more strongly than ever that St. Paul should be sold or merged," said Mr. Keefe in a statement.

"Since management has expressed no interest in actively exploring this means of maximizing shareholder value, I remain totally committed to my shareholder proposal."

Mr. Keefe's New York investment firm, Keefe Managers Inc., said it retained Beacon Hill Partners Inc., a proxy solicitation firm, to help it communicate with St. Paul shareholders.

St. Paul's share price, which lagged after Mr. Keefe's efforts appeared to be sidetracked by a series of key departures from his firm, jumped 87.5 cents to $21.5625 while most other bank and financial stocks were weak.

Mr. Keefe began pushing the $6 billion-asset St. Paul's to sell last year. He outlined his case in a letter to shareholders on Jan. 11.

"Through sale of the company, we eliminate the downside risk that St. Paul-with its stagnant operating earnings and meager return on equity-will continue to flounder in a world of increasing competition," Mr. Keefe asserted. …

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