Nabi Under Fire Again

Hedge funds are trying to force a delay in the company's annual meeting.
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Hedge funds are blasting

Nabi Biopharmaceuticals

(NABI)

again, and this time they're trying to force a postponement of the company's annual meeting scheduled for Friday.

The latest attack comes from Harvest Management LLC, a New York firm that owns 9.4% of Nabi's shares through several investment vehicles. Harvest says it won't attend the annual meeting and is encouraging other investors to boycott the session to deny a quorum, according to a May 2 filing with the

Securities and Exchange Commission

.

Nabi needs stockholders owning a majority of its shares outstanding to appear in person or via proxy to reach quorum. Otherwise, it would have to reschedule. If the meeting is postponed, Harvest says it might propose certain actions that could include nominating new directors or taking "other actions ... to maximize shareholder value."

The threat from Harvest comes shortly after a flurry of criticism

from two other hedge-fund managers, Daniel S. Loeb, who controls 13.7% of Nabi's shares, and David M. Knott, who controls 9.6%. Both say Nabi should ditch its investment banker, Lehman Brothers, and look for an acquirer.

Complaining about Nabi's strategy, Harvest's SEC filing says the company's assets "can be much better realized as part of a larger, more experienced organization."

Although the three fund managers own roughly 32.7% of Nabi's shares, some of that stock won't count in their protest against management. Each bought some shares after March 24, the cutoff date for voting at the annual meeting.

Nabi is trying develop a vaccine against

Staphylococcus aureus

, a bacteria that's the leading cause of hospital-based infections. In addition to working on the StaphVax vaccine, it also is conducting research on Altastaph, a treatment for infections caused by

Staphylococcus aureus

. Additionally, the company is working on a vaccine for nicotine addiction.

Earlier this month, one of Knott's executives sent Nabi a letter reiterating the firm's desire to boot Lehman Brothers. If Lehman departs, Knott "would be happy to support current management," the letter says. If Lehman stays, the hedge fund won't attend the annual meeting and won't vote its shares.

The letter is part of an SEC filing in which Knott repeats his belief that Nabi would be an attractive takeover candidate. Knott owns shares through seven investment entities.

The schedule for Friday's annual meeting appears routine with no shareholder petitions in the lineup. Shareholders will be asked to ratify an accounting firm and elect eight directors, including Thomas H. McLain, the chairman and CEO.