A federal judge yesterday extended a temporary restraining order blocking attempts by Washington millionaire Joe L. Allbritton to acquire controlling interest in Riggs National Bank. At the same time Allbritton released figures that indicate that Riggs shareholders have continued to offer him their stock in spite of advice not to do so from Riggs management.
U.S. District Court Judge Norma Holloway Johnson, at Riggs' request, postponed by one day a hearing on whether a preliminary injunction should be issued to block the tender offer through which Allbritton hopes to gain control of the city's largest financial institution.
At the same time the judge extended the temporary restraining order which bars Allbritton from soliciting more stock or trying to prevent shareholders from withdrawing stock already issued.
Announcing steps that Allbritton took to comply with the extension order, Allbritton's public relations firm also noted that as of yesterday 732,540 shares of Riggs stock had been offered and not withdrawn. That figure is higher by more than 44,000 shares than the figure Allbritton's lawyers quoted in court last week, indicating that shares have continued to come in. A few hundred have also apparently been withdrawn, but Allbritton registers a net gain.
Although the order bars Allbritton from soliciting stock, if shareholders continue to offer it, the former Washington Star owner has no control over that, an attorney for Allbritton said yesterday. The shares simply stay with the depository, Bradford Trust Co., until Allbritton's right to go forward with the tender offer (offer to buy shares of a company at a stated price) is resolved.
Allbritton also said he is extending by two days the period during which shares may be offered or withdrawn.That action was also part of a federal court order. Originally the offer to purchase at least 600,000 shares of common stock of Riggs was scheduled to expire at 10 a.m. March 10.
In another devlopment yesterday the Federal Reserve Board approved Riggs' application to become a bank holding company, an initiative Allbritton has opposed.
Under the terms of the Fed's approval, the transformation cannot occur before April 5 or later than three months after yesterday's order. Shareholder approval is also required to set up the bank holding company, and a meeting has been set for April 22 for shareholders to vote on the proposal.
Allbritton has opposed the plan, saying that it will prevent holders of large blocks of stock from exercising the control they might otherwise be able to exert. Allbritton already controls approximately 15 percent of the bank's stock and hopes to control about 35 percent if his tender offer is successful.