Ahmanson Buys Coast Savings
H.F. Ahmanson & Co. agreed to acquire Coast Savings Financial in a $900 million deal that is expected to close in February.
Many analysts believe that the October acquisition was a substitute for Ahmanson’s failed bid to acquire Great Western Bank earlier in the year. Ahmanson Chairman Charles Rinehart has said that his firm needs to continue growing through acquisitions in order to protect itself from a takeover.
To simplify the deal, Ahmanson issued tradeable certificates to Coast shareholders representing the right to receive any after-tax proceeds from Coast’s goodwill litigation. Thrifts across the country are suing the federal government to recover losses sustained after the Congress in 1989 eliminated the use of an accounting procedure called “supervisory goodwill.”
It may not be a happy New Year for many Coast employees, as Ahmanson has said it plans to close 52 out of 90 existing Coast branches.