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Merion Road Capital Management and Blue Hill Advisors went public on July 7 with a letter demanding United Bancorporation of Alabama (OTC: UBAB) execute a sizable tender offer from excess capital, lift profitability, and overhaul its corporate governance.
The argument is straightforward: the bank is holding more capital than its business requires. The complication is that a letter to the board of a small OTC-listed community bank is rarely a forcing event on its own.
What the investors are asking for Merion Road and Blue Hill are making three demands. They want a tender offer funded by what they describe as UBAB's excess capital. They want improved operating profitability.
They want stronger corporate governance.
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