AmeriServ Financial in Johnstown, Pa., has responded to Driver Management, stating that its board tried to work with the activist investor before it went public with a proxy challenge.
Driver Management, led by Abbott Cooper, recently disclosed plans to nominate three directors to stand for election to the $1.4 billion-asset AmeriServ’s board. Driver owns about 8.1% of AmeriServ’s outstanding stock.
AmeriServ disclosed in a regulatory filing that its board is reviewing Driver’s notice in order to determine if it complies with “applicable requirements” in its articles of incorporation and bylaws.
AmeriServ, in a Jan. 19 letter to Cooper included with the filing, said it attempted “constructive engagement” with Driver by invited the investor to provide director candidate biographies, make candidates available for interviews and submit related questionnaires.
“We now understand that Driver prefers … running a public campaign and nominating director candidates for election at the” annual meeting, Allan Dennison, AmeriServ’s chairman, wrote in the letter.
Dennison wrote that AmeriServ’s board had already been planning several steps, including efforts tied to board composition and corporate governance, that “directly counter Driver’s accusations of entrenchment.” The letter did not provide specific details on those efforts.
Finally, the letter made it clear that AmeriServ has no plans to resolving the issue by buying Driver’s shares or paying restitution to the investor. For instance, First United in Maryland bought out Driver, while First of Long Island recently agreed to reimburse the investor $100,000 for out-of-pocket expenses.
“We do not believe it is in all of our stakeholders’ best interests to address every public and private statement made by Driver,” Dennison wrote. “We also have no intention of agreeing to the type of seemingly self-enriching share repurchases and cash payments that Driver has extracted from other community banks in order to end litigious contests.”