This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

A 'Sad Day' at Sovereign

The immediate reaction from Sovereign's dissidents was a promise to continue the fight. Just how they intend to do that isn't clear.

"We are disappointed that the NYSE has chosen to allow this transaction to proceed, which disenfranchises the existing owners of Sovereign," said the top executives of Franklin Mutual Advisors, in a prepared statement. "We will continue to consider all available options to us in order to protect the rights of Sovereign's owners.''

Franklin, a subsidiary of mutual fund giant Franklin Resources (BEN - Get Report), is Sovereign's second-biggest shareholder.

Officials with Relational Investors, the San Diego-based investment firm that is the bank's biggest shareholder and which began the crusade to upend the Santander deal, were equally vague in outlining their next step. In a prepared statement, Relational, which owns 7% of Sovereign's stock and is trying to elect two of its officials to the bank's board, says it may ask the Securities and Exchange Commission to review the NYSE's decision.

"This is a sad day for the American capital markets,'' said Relational principal Ralph Whitworth. "It reverses two decades of progress. We are considering whether the NYSE's participation in restructuring this transaction and the resulting rule change should be appealed to the SEC.''

But Langevoort says appealing to the SEC is even less likely to succeed than a lawsuit.

"The SEC generally takes a hands-off attitude on the issue of when shareholders can vote,'' says Langevoort. "The courts have said that is a state law issue and not a matter of federal concern.''

An SEC spokesman declined to comment on the Sovereign dispute.

Oddly, Relational Investors and Franklin aren't yet talking about filing a lawsuit to block the deals. But waging a court battle is far more costly and time-consuming than their tactics thus far.
2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
BEN $49.21 0.00%
AAPL $126.44 0.00%
FB $87.28 0.00%
GOOG $523.40 0.00%
TSLA $280.02 0.00%

Markets

DOW 17,730.11 -27.80 -0.16%
S&P 500 2,076.78 -0.64 -0.03%
NASDAQ 5,009.2140 -3.9090 -0.08%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs