Puerto Rico bank says it received 'frivolous' buy-out proposal
|
| Published on Tuesday, July 17, 2007 |
Email To Friend Print Version |
By Otis Bilodeau
SAN JUAN, Puerto Rico (Bloomberg): Doral Financial Corp., the Puerto Rican bank-holding company facing insolvency, said it has received a "frivolous" proposal from a "purported entity" called Atlas Monetary International Trust to purchase its banking unit.
Atlas Monetary intends to present the offer at the company's July 17 shareholder meeting, Doral said in a filing with the US Securities and Exchange Commission on Monday. In a letter attached to the filing, Atlas said it would pay $3 per share for Doral Financial Services, "twice the amount of any previous offer."
Doral said in April it probably would have to seek bankruptcy protection unless talks with a private-equity firm resulted in a cash infusion of at least $700 million. Shareholders are scheduled to vote tomorrow on a $610 million buyout offer from a group led by New York-based Bear Stearns Cos. Doral is required to make a $625 million bond payment by July 20.
"The company considers the purported proposal to be entirely frivolous and incapable of action," Doral said in today's filing. "If presented at the shareholders meeting, the proposed resolution will not be considered as it does not comply with the advance notice provisions of the company's bylaws."
Public records and regulatory filings for Atlas Monetary International Trust couldn't immediately be located. The Atlas letter attached to Doral's filing today said "the trust is holding approximately three trillion dollars in assets." The assets are "represented by" silver, gold, cash, and gold-backed bonds, according to the letter.
The letter listed an "Irrevocable Trustee" named Andrew Cipollo at an address in Corona, California. A person who answered a California phone number contained in the letter identified himself as Cipollo and said he was a trustee for Atlas. He said Doral's statements about Atlas were "garbage." He also said he currently was in Puerto Rico.
"It's a legitimate offer," he said. Atlas is "a private trust," created "many years ago" that "holds a lot of assets," he said. He declined to say who formed Atlas or to specify its holdings.
The letter also listed Ivan Diaz-Lopez, a lawyer in San Juan, as an attorney for Atlas. Reached by telephone, Diaz-Lopez said Atlas's offer was bona fide.
"If they claim that we don't have the capacity to pay, that's not true," he said.
Diaz-Lopez transferred the call to someone who identified himself as Ken Peterson and said he's Atlas's chairman.
"We have the ability to perform and we have the ability to go forward," said Peterson, who indicated he was in Puerto Rico today and otherwise based in Tampa, Florida, and Minnesota. "The principals that are involved are financially sound."
He declined to name the Atlas principals.
Doral spokeswoman Lucienne Gigante and Elizabeth Ventura, a spokeswoman for Bear Stearns, didn't immediately return telephone calls seeking more information. |
|
