Release Date: July 12, 2004
New York, NY-Amalgamated Bank's LongView Small Cap 600 Index Fund withdrew its shareholder proposal to repeal the classified board at Bally Total Fitness (NYSE: BFT) after negotiations with the company resulted in significant governance reform. LongView withdrew when Bally agreed to redeem its current poison pill and to adopt a policy that shareholders shall have a right to vote on any future pill measures.
Classified boards and poison pills are defense mechanisms that some companies adopt to discourage a hostile takeover. LongView finds that though such devices are designed to work as anti-takeover tactics, they may also have the effect of helping to entrench current management and make it difficult for shareholders to effectively push for new direction at a company.
In addition to LongView's proposal, Bally had also received four proposals on governance issues from Liberation Investments , which had announced that it intended to solicit proxies in support of its proposals. Following discussions of all governance-related shareholder proposals, including the one submitted by LongView, Bally agreed to repeal its current poison pill measure and adopt a policy requiring shareholder review of any future pill at the following annual meeting or a special meeting within 270 days. As a result, Liberation and LongView agreed to withdraw their respective proposals. In agreeing to withdraw, LongView said it would not offer, submit, or present any stockholder proposal prior to Bally's annual meeting in 2006.
"LongView is pleased to have reached an understanding with Bally. This agreement eliminates the current poison pill and ensures that any future pill measure would trigger a binding shareholder vote," said Amalgamated Bank's legal counsel, Cornish Hitchcock.
The LongView Funds currently hold 14,567 shares of Bally Total Fitness common stock.
Founded in 1923, Amalgamated Bank invests workers' retirement savings through its LongView Funds. With $8 billion in assets under management, LongView actively votes its proxies and sponsors shareholder initiatives for corporate reform. Amalgamated Bank is available online at www.amalgamatedonline.com.
