Former Missouri Sen. Stuart Symington has emerged as the latest prominent political figure recruited by a group of Arab investors who are trying to take over Financial General Bankshares Inc., the $2.2 billion Washington bank holding company.
Two Arab investors who own almost 10 percent of the stock of Financial General have agreed to give Symington voting power over their interest in the bank, according to reports made to the Securities and Exchange Commission, and obtained yesterday by The Washington Post.
Symington's role in the nine-month-long fight for control of the giant bank holding company is not made clear by the reports to the SEC and Symington refused in a telephone interview to expand on the report.
"I'm going to be a voting trustee, that's all I can tell you," said the former Missouri senator and Secretary of the Air Force. The stock he will control is worth more than $8 million.
Symington also declined to comment on how he became involved in the complex Financial General case, which began when four Arabs represented by former budget director Bert Lance bought about 20 percent of the stock of the bank holding company.
Symington's job as voting trustee for two of the four Arab investors was revealed in reports made to the Securities and Exchange Commission by Lance and others involved in the case.
The SEC documents show Symington will be given control over stock owned by two powerful and mysterious Middle Eastern investors - Sheik Kamal Adham, former head of Saudi Arabia's intelligence agency, and Faisal Saud al Fulaij, former chairman of Kuwait Airlines. Both men have about $4 million each invested in Financial General and have close ties to the ruling families of their countries.
Why they need an American political figure to be voting trustee for their stock and how the trustee fits into the complicated pattern of holding companies being formed by the Arabs could not be learned.
The reports to the SEC reveal the Arab investors represented by Symington are forming a bank holding company which will make a public offer for all the shares of Financial General. Financial General owns Union First National Bank of Washington, First American Bank of Northern Virginia, American Bank of Maryland and several other financial institutions.
If the Arabs succeed in gaining control of Financial General, they intend to replace Board Chairman B. Francis Saul II and President J. William Middendorf II, the SEC flings state. Saul, a prominent Washington real estate man, is now the biggest stockholder of the company; Middendorf, a former Secretary of the Navy, heads of a group of investors now claiming to control a majority of the shares.
A major reorganization of the bank holding company is planned if the takeover is successful, says the SEC filing, which amounts to a progress report on efforts of the Arabs to gain control of a majority of the bank's stock.
The report reveals that one of the four Arabs who originally invested in Financial General has decided to drop out of the group. He is Sheik Sultan bin Zaid al Nahyan, the crown prince of Abu Dhabi. The royal family of Abu Dhabi will continue to be represented in the group by Abdullah Darwaish, who controls stock held for Sheik Sultan's younger brother, Prince Muhammed.
The SEC filing maps a labyrinth of internation corporate structures that have been set up by the Arab investors for the Financial General deal.
The Arabs became involved in the Financial General take-over bid through Bank of Credit and Commerce International, a London-based bank headed by Pakistani financier Aga Hasan Abedi.
BCCI has a subsidiary called International Credit and Commerce (Overseas) Ltd. that is known as "ICIC." ICIC, the report says, will own stock in a third company, Credit and Commerce American Holdings (CCAH), a Netherlands Antilles corporation.
The two investors who have chosen Symington as their trustee will transfer all their shares of Financial General to CCAH, in exchange for shares of CCAH. Symington "will, for a specified period of time, have complete voting powers with respect to all the shares of CCAH" owned by Ahdam and al Fulaij, the report specifies.
CCAH in turn will transfer the Financial General stock to a fourth company, Credit and Commerce American Investment, (CCAI) a Netherlands corporation. It will be CCAI that will actually make the public tender offer for the shares of Financial General, the report says.