Legg Mason Capital Management raised its stake in Countrywide Financial Corp., the biggest U.S. mortgage lender, to 15 percent and said it hasn’t decided whether to vote for Bank of America Corp.’s $4 billion takeover, Bloomberg News reports.
Countrywide should remove a “poison pill” designed to discourage takeovers, fund manager Bill Miller said today in a letter to investors. His firm previously held a stake of about 12 percent and may acquire as much as 25 percent, the letter said. Baltimore-based Legg Mason was already the biggest stakeholder of Countrywide, based in Calabasas, California.
Shareholders and analysts have split on whether Countrywide got a fair price from Bank of America, the nation’s second- largest bank. Investors including SRM Global Fund, which held a 5.2 percent stake, have said the bid is too low, while Paul Miller of Friedman Billings Ramsey Group Inc. contends Bank of America is overpaying because of Countrywide’s continued losses.
“We were quite surprised by the decision to sell the company at close to a seven-year low in the stock price, and agreeing to a bid that amounts to only 30 percent of book value,” Bill Miller’s letter said.
