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February 7, 2008

Illinois hedge fund is going after Bank R.I. seats again

A pair of dissident investors this week resumed their fight with the management of Bank Rhode Island and will once again try to force a sale of the Providence bank.

The two men who lead PL Capital LLC, an Illinois hedge-fund investment firm, are once again seeking seats on the board of directors of Bancorp Rhode Island, the bank's parent company. It is the second time the men, Richard Lashley and John Palmer, have sought board seats.

PL Capital has a history of taking on the management at banks it considers underperforming. It seeks to profit from improved earnings, a quick run-up in stock prices or the sale of its targets.

Lashley and Palmer lost a bid last May to gain seats on the Bancorp Rhode Island board (BARI: Nasdaq) as company shareholders sided with the bank's management in a proxy fight.

This year, the two men are joined by former investment banker Daniel Mullane, of Connecticut, who headed Advest Group Inc. before its sale to the Merrill Lynch brokerage house. He is also being nominated for a board seat.

Bancorp Rhode Island's management has nominated its own slate of board candidates, headed by company founder and board chairman Malcolm G. Chace. The company's shareholders will vote on the board nominations May 21, during their annual meeting.

This year, they are joined by Daniel Mullane, who was head of Advest Group Inc. before its purchase two years ago by the Merrill Lynch brokerage house.

Posted by Peter Phipps  at 1:16 PM | Permalink

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