A group of Mississippi-based real estate companies said yesterday that it will seek control of Hotel Investors of Chevy Chase, a $31.5 million company that operates and manages hotels across the country.
The Mississippi companies, headed by Leland R. Speed and Brent D. Baird, told the Securities and Exchange Commission that they now own 8.8 percent of Hotel Investors' stock and will solicit stockholder votes for their own nominees to Hotel Investors' two boards of directors.
The vote contest will focus on the institutional investors who own 40 percent of the 4 million outstanding shares of Hotel Investors stock. The two biggest stockholders are Morgan Guaranty Trust Co. with 10 percent and the U.S. Steel Pension Trust Fund with 8 percent.
Hotel Investors is the name for Hotel Investors Trust and Hotel Investors Corp., two operations jointly owned by the same stockholders. The stock of the two companies trade as "paired shares" on the New York Stock Exchange.
The next election of directors is scheduled for Dec. 12.
Wilson N. Krahnke, senior vice president and treasurer of Hotel Investors Trust, said that his board met with Speed Oct. 11 in Chevy Chase, that Speed repeated a previous request for seats on the board, and that the board did not respond. Asked if Hotel Investors would resist Speed's efforts to elect his own directors, Krahnke replied laconically, "We've not invited him on."
The Mississippi group said that they would oppose any effort by Hotel Investors to limit shareholders' rights, "including the right to cumulative voting."
Krahnke said he did not know, at this point, what action Hotel Investors might take on shareholder votes. Cumulative voting permits a stockholder to multiply the number of his shares by the number of directors up for election and then allot his total vote as he wishes. It is a device that favors takeover efforts.
Krahnke said Hotel Investors probably will give Speed access to the stockholders list. The Mississippi group told the SEC it had hired the Carter Organization of New York to solicit proxy votes.
The Mississippi group includes Citizens Growth Properties, Congress Street Properties, Highlands-National and The Parkway Co. They are based in Jackson.
Hotel Investors Corp. operates eight hotels leased from the trust and manages six hotels leased from others. They include the Brock Residence Inn in Tysons Corner and the Quality Comfort Inn in Herndon.