Shareholders eye Mason-Dixon sale 17 investors want company to explore merger, acquisition

November 23, 1996|By Bill Atkinson | Bill Atkinson,SUN STAFF

A group of shareholders who own stock in Mason-Dixon Bancshares Inc. said yesterday that it wants management to explore ways to "maximize shareholder values," including the sale of the company.

The group of 17 investors filed a document yesterday with the Securities and Exchange Commission stating that it holds 5.1 percent of the Westminster-based banking company.

The group claims that one or more banks have approached Mason-Dixon, expressing an interest in acquiring or merging with the $838 million-asset financial institution. But the directors have failed to meet their obligation to shareholders by not engaging in discussions, the group said in a release.

"It is our belief that the board has not even pursued or explored the opportunities," said Barbara Floyd, one of the investors and president of Anthony Investments Inc., a Severna Park-based financial consulting firm, and a former employee of a Mason-Dixon subsidiary bank. "We feel as a board of directors their obligation is to explore all opportunities whether it is through continued independence and / or an acquisition. We are not saying we want the bank necessarily to be sold. It may make sense to be acquired, it may not."

In a statement, Thomas K. Ferguson, Mason-Dixon's president and chief executive, said the company is a "fiercely independent organization" that has in place a long-term plan for growth and expansion.

"A short-term premium over the current market price of the stock is not in the best interests of the Mason-Dixon stockholders," he said. "Management believes that the successful implementation of the plan will translate into greater long-term values to the company's stockholders ."

Mason-Dixon is the parent company of Carroll County Bank and Trust Co., and Towson-based Bank of Maryland, which it acquired in July 1995.

The company's stock closed yesterday at a high of $22.25 a share, up from $21.75, and it has increased by nearly 33 percent since it hit a low for the year of $16.75 on Oct. 16.

Jon Holtaway, a bank and thrift merger analyst with Rockville-based Danielson Associates Inc., said Mason-Dixon's earnings have been flat since it acquired Bank of Maryland. The company earned 40 cents a share in the third quarters of 1995 and 1996.

"At this point, to ask them to sell would be a little impatient," he said.

But Holtaway said that if Mason-Dixon doesn't improve within six to 12 months, shareholders will have a stronger case.

Holtaway said there could be a number of banks interested in acquiring Mason-Dixon, ranging from First Maryland Bancorp, which has said publicly it is looking for acquisitions, to Mercantile Bankshares Corp. and Crestar Financial Corp.

Pub Date: 11/23/96

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